This booklet is of a different nature: Its aim is to propose a cross-benchmark of France and Germany, commonly known as the franco-german couple. It was prepared in the context of the report Reforms, Investment and Growth: An agenda for France, Germany and Europe commissioned by the French and German economic ministers to Henrik ENDERLEIN and Jean PISNAI-FERY.
The data deliver two main messages.
- Firstly, France and Germany have significantly diverged in the last decade on a number of accounts, mainly the labour market, external accounts and public finances. Education and inequality are also areas where both countries have departed from long-standing parallelism.
- Secondly, the comparison is often but not always to the advantage of Germany.
There are a few domains where France is definitely doing better, such as demographics, infrastructure and inequality.
The indicators were prepared by a team led by Hervé MONANGE and composed of Quentin DELPECH, Véronique DEPREZ-BOUDIER, Pierre DOUILLARD, Camille GUÉZENNEC, Cécile JOLLY, Frédéric LAINÉ, Rémi LALLEMENT and Nicolas LORACH.
The booklet was edited by Hervé MONANGE and Nicolas LORACH and copyedited by Sylvie HURION, Morgane LAPEYRE and Valérie SENNÉ.
Demography - Migrations
- Birth rates drop in Germany, not in France
- Migration only just offsets decline in Germany
- More people in France than German by 2060?
Education - Training
- A more and more qualified population in both countries
- Germany focuses on vocational training
- Common challenges in education
- Adults lack skills, especially in France
- Germany has more people in jobs
- Done with school, the transition is smoother in Germany
- Public spending: higher in France, more targeted in Germany
- Common challenges regarding the labour market
- Tax wedge convergence
- Labour cost index: a slowdown in Germany, especially in services
- Unit labour cost divergence
- Employee compensation
- A new divergence in trade openness
- Current account balance : with strong surpluses, Germany is increasingly a creditor to the rest of the world
Research and innovation
- R&D effort: Germany outperforms
- Scientific performance: similar trends
- Patents: declining shares, but higher in Germany
- A lower propensity of enterprises to innovate in France
- France tops start-up ranking
Savings - Investment
- Germany’s high households saving rate contrasts with a decreasing rate of investment
- Since the crisis, perceived infrastructures quality has decreased in both countries but slightly more in Germany
- Significant efforts to reduce greenhouse gas emissions, which must be enhanced
Productive structure and firms
- Manufacturing vs. public services
- Germany has more companies with 20+ employees
- Non-financial firms: more profitable in Germany
Public finances and taxes
- Government spending much higher in France
- Debt ratios diverged post-2010
- Taxes converged on consumption, not capital or labour
- Environmental taxes lower in France
- Rising poverty rate and inequality in Germany
- Greater wage dispersion in Germany