— News

— Industry

— Industry & Innovation

Reindustrialization: why France has everything to succeed?

In 40 years, France has collectively sacrificed its industry. Devalued compared to services, the French industrial sector has declined over the decades, from 26% of jobs in 1980 (5.3 million workers) to only 13.3% (3.2 million) today. The consequence is well known: a disengagement of France, which had to its credit leading industrial successes, vis-à-vis its European neighbors, starting with Germany.

However, a glimmer of optimism is beginning to emerge. France finally seems to be waking up to the importance of producing locally and cleanly. The proof: it has created more than 100,000 industrial jobs in recent years. To achieve a real industrial rebound, it is essential to rely on the ecological and energy transition and to overcome persistent obstacles.

These obstacles include long administrative delays, an image that still struggles to attract younger generations, insufficient investment in research and development, and insufficient training of young people for industrial occupations.


“We each have our responsibility in this affair,” concluded senior civil servant Louis Gallois in Nicolas Dufourcq’s book on the deindustrialization of France. In forty years, the industrial sector, which employed 5.3 million French people in 1980 (26% of the country’s jobs), now accounts for only 13.3% of employment for 3.2 million workers. This is the unfortunate result of our collective lack of commitment to our industry since the end of the last century. The Fabless movement, which had long been influential, thought that France could do without its factories and trades, which were considered degrading and undervalued because they were physical and manual, and dreamed of a society entirely focused on intellectual and fulfilling service and leisure activities. This abandonment of an industrial ambition, after the dazzling successes of the post-war period (nuclear, high-speed lines, Concorde), explains why France is today considered a deindustrialized country. A particularly marked dropout, when we compare France to its European neighbors, starting with Germany. Blinded by this concept of a country that doesn’t need factories, we rediscover that the industrial ecosystem is like a Russian doll: behind each finished product, there is a series of suppliers and service providers upstream who bring materials, tools, machines, new parts. The good we buy in a store or on the internet is the product of the work of this entire value chain. Once destroyed, this chain is very difficult to rebuild, because each of its links has to be rebuilt. If a single supplier of the industrial process is missing, an entire ecosystem remains blocked.

However, there is a sense of optimism today. In recent years, France seems to have become deeply aware of this latent deindustrialization and of its interest – if not its security – in producing locally, in its own way and by strengthening its economic independence. The balance of industrial job creation now stands at more than 100,000 jobs over the last six years. This dynamic is marginal when compared to the approximately 2 million manufacturing jobs lost since 1980. But it is certainly a sign that an industrial rebound is possible, provided that we rely on (i) a favourable dynamic driven by the ecological and energy transition and (ii) to correct the obstacles still faced by the French industrialist.

The observation of a dynamic favourable to an industrial rebound

The Covid-19 crisis has highlighted the criticality for European powers to secure their supplies, by diversifying them, and to rely on local value chains, or at least geographically close ones. This concept of nearshoring, which worked perfectly during the pandemic, deserves to be explored further. It is indeed not desirable that the obstruction of the Suez Canal by a broken cargo ship, or a flooding of Thailand’s battery factories, could temporarily block entire sectors of the French economy because of our inability to produce certain types of parts or components. Making oneself totally dependent on foreign subcontractors operating in countries with questionable human rights conditions, rather than manufacturing in France, could already be questioned, at least on a social level. From now on, the risk is also geopolitical, in an increasingly unstable world, with the continuation of the war in Ukraine, the Israeli-Palestinian conflict, the attack on Azerbaijan in Nagorno-Karabakh, an increasingly systematic opposition between the Chinese bloc and the American sphere, or the deteriorating political situations in some African countries.

Reindustrialization is therefore synonymous with freedom from world affairs, and all the more so at a time of ecological and energy transition, which will be synonymous with the scarcity of resources. The 2023 annual report of the International Energy Agency (IEA), published a few days ago, reminds us that global energy demand will have to reduce in the coming years in order to meet the objective of global warming around 1.5°C. This transformation will inevitably lead to conflicts of energy use, with already concrete consequences for companies. These are evolving in a context of energy price inflation (the price of a barrel of oil, currently around €90, is much higher than it should be given the slowdown in the global economy). They are also facing increased regulatory obligations at the European level. The price of a tonne of CO2, which for a long time remained moderate at around €20, has recently exploded and is now close to €100 per tonne. As the number of carbon allowances emitted begins to approach the volume needed for economic activity, some companies are forced to buy more pollution rights, logically increasing prices. The tonne of CO2 is becoming a scarce and therefore expensive resource. In order to compete fairly with the rest of the world, preserve a level playing field and not risk penalising its industry, the European Union will probably have no choice but to set up a new carbon border tax mechanism. In this context, the increase in the cost of production, whether relocated to the other side of the planet or carbon-intensive, will be a powerful lever in favor of local and clean production. Industry will need to (re)locate to places where energy is decarbonised and at a relatively controlled price. Europe and France have a card to play here.

The ecological and energy transition requires very significant local investments. The National Low Carbon Strategy estimates that investments will be made over the period 2024-2028 at €36 billion per year for the transport sector alone, €18 billion per year for buildings, and €10 billion per year for energy and networks. The Pisani-Ferry-Mahfouz report assesses in the same order of magnitude the additional spending needed for the ecological transition, around two points of GDP per year by 2030 (i.e. around €60 billion per year). The public authorities, currently indebted to more than 110% of GDP, will not be able to cope with these amounts. The good news is that these massive needs can be financed by the savings of French households. Long-term savings represent nearly €3,200 billion, including life insurance (€1,870 billion), regulated savings (€860 billion) and shareholding in listed assets (€420 billion). A stock of savings that continues to increase, with annual net inflows growing and exceeding €110 billion since the pandemic. French savings therefore have the means and resources to finance the energy and ecological transition of industry. The reindustrialization of France therefore becomes a tremendous opportunity to strengthen French economic and social cohesion around a unifying project: to finance the decarbonization of our economy, thanks to a clean local industry, by using popular savings and shareholding.

Long neglected, French industry is benefiting from a window of opportunity and renewed interest. It is up to the public authorities to support this momentum by reducing the persistent obstacles that hinder this entrepreneurial and industrial rebound.

Locks to be unlocked to allow an industrial rebound

While the bet launched by the President of the Republic in January 2022 to open “100 new industrial sites per year in the country” by 2025 is about to be met, the barriers of the French administrative mille-feuille remain. This is evidenced by the gap between the theoretical time taken to obtain an environmental permit (9 months) and the actual time it takes to set up a plant (17 months). These almost systematic delays present significant additional costs for an entrepreneur: the Caisse des dépôts et consignations estimates the negative impact of an 8-month postponement of an establishment project for an SME with a turnover of €10 million at €700,000. It is high time to commit to ending the administrative delays that have become the norm, and to reduce the theoretical timetable for the environmental authorisation procedure. In Germany, for the same mission, the theoretical deadlines amount to eight months (and are respected!). In Sweden, they are between six and eight months, in Poland around five months. This French disadvantage is largely explained by the conditionality of the public inquiry to the administrative instruction and the opinion given by the environmental authority on the impact study. In other words, the public is invited to comment at a late stage of the proceedings. The insufficiently satisfied social demand for participation, as well as the long administrative timetable, are detrimental to both stakeholders and businesses. A parallelization of the proceedings, in order to eliminate infill delays, would speed up the investigation while strengthening the role of the public, who would be consulted earlier and who could feed the investigation with their observations. The “Green Industries” bill, promulgated on 23 October 2023, is a step in the right direction, with the aim of halving the time it takes to issue environmental authorisations. In addition, the promise to create “50 turnkey sites” is also a positive signal sent to manufacturers. It shows that reindustrialization and the objective of “zero net land artificialization” by 2050 are compatible, provided that administrative and industrial time converge.

The industrial revival of France will also involve a paradigm shift around its image in the collective imagination, starting with that of politics. For too long (and still) associated with Emile Zola’s novels, the figure of the worker working long hours in factories has remained prevalent in French society, wrongly. Because an industrial job is precisely a “rich job”: it creates an average of 1.5 indirect jobs and 3 induced jobs in the rest of the economy. While the decline in the unemployment rate seems to be slowing down, industrial recovery is becoming an effective solution. The industry also stands out for the quality of the narrative it shares with its employees: it offers rewarding work, with visible results. We participate in the construction of electric cars, carbon-free planes, turbines for dams, hydrogen trains, everyday bicycles, or even shoes: in short, products that contribute to social utility. It should be remembered that 83% of French employees think it is important to work for a company that shares their values. At a time when a growing number of students from prestigious schools are refusing prestigious careers on the grounds that they are unable to give meaning to their work, the industry is offering operational, concrete and local jobs. The more than 800,000 apprenticeship contracts signed in 2022, 14% of which were in the industrial sector, are encouraging and show a renewed interest among younger generations to discover jobs that are beneficial to society in an “active” and operational way. Groupe ADP can attest to this, with dozens of apprenticeship contracts at its airports, as close as possible to its needs for high-paid and rewarding industrial jobs.

The public authorities, in addition to improving the image of the industry, must also play with the amounts allocated to research and development. France is lagging behind in this area. In the 1970s, R&D accounted for nearly 3% of France’s GDP. It has since eroded to just over 2% in the 2000s. The State, aware of the importance of this indicator in the production of national wealth, has since tried to revive it (via the CICE in particular). But this spending is still too low, stagnating at around 2.2% of GDP. By way of comparison, Germany, the United States and the Nordic countries spend about 3% of their national wealth on R&D, and this ratio is as high as 5% in South Korea. This investment in innovation, starting with that of the public authorities in fundamental research, is nevertheless vital, when the competitive advantage of companies depends on their specialization in high value-added, and therefore capital-intensive, segments. Investing is not only about preparing the industry of tomorrow, investing is a daily act necessary to maintain the highest technological level and improve your production methods every day. R&D takes on its full meaning as the productivity of French workers has fallen by around 3% since 2019.


France must therefore reconnect with its audacity, which inspired the world. The Concorde, nuclear power and the TGV are all feats that have demonstrated its industrial know-how, but also federated society. Today, a dizzying challenge is opening up before us: that of the ecological and energy transition. Investors’ risk-taking will be necessary to achieve this, in order to commit considerable financial flows to activities with rates of return below current standards. If there is one lesson to be learned, it is that this transformation will be achieved through research and innovation, but above all through education. It is our responsibility to train and train the younger generations towards industrial professions, which are still undervalued despite their social utility and undeniable environmental benefits.

Leave a Reply

Your email address will not be published. Required fields are marked *

— To go further