While we still wonder what the impact of the Covid will be on the global economy, comparisons with the 2008 financial crisis come up regularly. The first elements nevertheless allow us to conclude that it will be less. And to fully appreciate the violence of the financial crisis at the end of the 2000s, we must in particular look at the side of French industrial production: the latter recorded a fall that it has never caught up with.
However, the start of a rebound was observed in 2009, but it was brutally cut off by the austerity and budget cuts policy implemented by European governments from 2010. A policy that caused a general fall in demand , a drop in orders in the industry and numerous closings of production units. The French automotive sector in particular has never recovered from the crisis, many units have been massively relocated in order to reduce costs. The reductions in production taxes or subsidies to companies decided successively by Nicolas Sarkozy (end of the professional tax), François Hollande (tax credit for competitiveness and employment, research tax credit) and Emmanuel Macron do not appear not have been effective in halting this decline.
In Germany, however, the situation was different. The industry has roughly recovered for three reasons. First, in 2008, German companies made extensive use of short-time working, which had the effect of facilitating the restart in 2009 since industries did not need to embark on hiring and job campaigns. training. Then, Angela Merkel’s Germany cut much less in its spending than Nicolas Sarkozy’s France in 2010. Finally, industries across the Rhine are largely focused on export markets, especially China, including The economy was booming in 2010.
“Whatever the cost”, for how long?
In the long term, sharply increasing during the Thirty Glorious Years, French industrial production began to slow down during the 1970s, against the backdrop of the oil crisis. Production nevertheless progressed at the end of the 90s, then stagnated from 2000. The fall in production linked to the Covid crisis was even more brutal than in 2008. But the catching up on the other hand much faster because the government does not seem to have made the same mistakes as it did back then. The use of short-time work in France has been massive, businesses have received broad support and there has been no austerity policy in France so far.
An inclination which should nevertheless end in the event of the re-election of Emmanuel Macron since Bruno Le Maire repeats over and over again that the “whatever the cost” is at the end and that the next few years will have to be those of the re-establishment of public accounts. The desire to relocate part of the industrial apparatus could then come up against an economic model that is less protective for this sector than, for example, the German model.