Could France Be the Emerging Economic Powerhouse of Europe?


Although France has suffered from an under-performing economy for decades, some indicators seem to hint at the nation becoming a superior economic performer in the not-too-distant future. This data runs contrary to the assumptions of many in the financial sector, particularly given the nation's sluggish performance to date, but the evidence appears compelling.

France has done little in the way of economic growth since 1990. According to the Organization for Economic Cooperation and Development (OECD), France's per capita gross domestic product (GDP) has grown more slowly than any other wealthy nation except Italy. In fact, France's manufacturing output is lower today than it was in 1990.

Normally, data like that would equate to a country on the verge of collapse. Yet, despite all of these signs, France's economy has continued to grow, albeit slowly. Moreover, and quite to the contrary of prevailing logic, a recent op-ed piece by Bloomberg has opined that France could be poised to outperform any other nation in the Eurozone by the middle of the 21st Century. The evidence is pretty convincing.

First, there is the fact that the people of France are far from overworked. The French spend fewer hours on the job than most other developed countries, meaning burnout is not an immediate concern. Workers do not suffer from significant income inequality, and the population tends to be healthy, long-lived, and abundantly fruitful. As a result, by the 2040s to 2050s, France should have a larger working-age population than Germany.

Next, there is the issue of productivity. Despite their reduced work hours, French workers are already more productive than German workers. If that productivity holds steady, then when the French working-age population grows, France's overall economic output should far exceed any other European nations.

Unfortunately, arguing against this position is France's chronically high unemployment. The rate routinely hovers around 10.5 percent. Although the French government has made a few moves to improve the employment situation, these measures have been largely ineffectual.

Although growth remains plodding, the French economy may be well positioned to take on the role of Europe's largest producer within a few decades, possibly despite itself. While short work hours and poor management have slowed growth, they have not completely stalled it. Thus, within a few years, the organic growth of the nation's working population could cause the economy to swell beyond any of its neighbors' without even trying.