Innovation and competitiveness: Germany overthrows France

THE ECO SCAN – Between its research and development spending and its higher productivity, Germany is more competitive than France. Le Figaro has selected several indicators to compare the two countries.

Who from Germany or France has the best competitiveness? The World Economic Forum used more than 100 combined indicators to measure the competitiveness differentials between all countries. According to its 2014-2015 competitiveness report, Germany is in fifth position while France is in 23rd place.

Since it is “difficult to find an indicator that allows competitiveness to be expressed in all its aspects”, as indicated by Marc Lassort, researcher at (Iref), Le Figaro focused on the main indicators.

Research and development (R&D)

Compared to Germany (2.9% of Gross Domestic Product), France is lagging far behind in its R&D spending (2.2% of GDP) for science and technology in 2013. However, “R&D is playing a role. one for innovation, factor productivity and therefore economic growth ”, specifies Marc Lassort.

• Patents filed

In 2012, there were 5,468 triadic patent families (set of patents filed with three of the main European, Japanese and American offices to protect the same invention) in Germany compared to 2,555 in France.

• Expenditure on higher education

In France, in 2011, we spent US $ 15,375 per student, or 13,874 euros, while for the same period in Germany, we spent 16,723 US dollars, or 15,089 euros. This remains well above the average for OECD countries (US $ 13,958).

• Productivity

The annual growth rate of the productivity of labor and capital factors in 2012 in France is non-existent. In contrast, in Germany it is 0.3%.

Regarding more specifically labor productivity, France is more competitive than Germany with a productivity of 59.5 dollars per hour worked per person against 58.3 dollars for Germany in 2012, according to.

Nevertheless, “the important thing is not the single-factor productivity of labor, but rather the total productivity of factors”. According to Marc Lassort: “The rise in labor productivity does not generally come from the increase in the cost of labor, but rather from an adapted educational policy, vocational training, the rise in skill levels, the increase in production technology, a better division of labor or even the simplification of operational tasks ”. Indeed, despite its high level of labor productivity, France is lagging behind with its high unemployment rate and weak growth.

• Labor cost

In the manufacturing industry, the hourly cost of labor in the fourth quarter of 2014 was 37.10 euros in France and 38.43 euros in Germany, according to Eurostat. On the other hand, for the same period in industry and market services, the hourly cost of labor reached 35.71 euros in France and 33.16 euros in Germany.

Moreover, “the existence of a high minimum hourly wage in France forces employers to exclude the least qualified and less productive jobs from the labor market, which leads to a considerably lower employment rate than in the countries where the minimum hourly wage is low or nonexistent, ”explains a study by the.

• Use

The employment rate (use of available labor resources) in France in 2014 was 64.2% in France and 73.78% in Germany.

• Growth

Result, the growth rate of France in 2014 amounted to 0.4% against 1.5% in Germany, according to the OECD.