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French industry workers cheaper than Germans

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French industry workers cheaper than Germans
Is it cheaper to hire industry workers in France than in Germany? Photo: AFP
12:08 CET+01:00
France has long been considered far more costly than Germany when it comes to labour costs, but times are changing. When it comes to industry France is now cheaper, new figures show.

France is famed for its high labour costs, but perhaps the reputation is now somewhat undeserved.

Figures released this week revealed that labour costs (such as salaries, social charges and training) in Germany have risen three times higher than in France since 2012.

The data, produced by national statistics agency Insee revealed that when it comes to industry French workers are actually 10 cents cheaper per hour to employ than their German counterparts (€37 compared to €37.10).

That stands in contrast to three years ago when French industrial workers cost four euros more than Germans.

It might only be 10 cents but’s it’s a symbolic shift for France as it struggles to keep up with Germany - the eurozone's most powerful economy.

The main reason for the shift in labour costs is the rise in labour costs in Germany, which have shot up 10 percent since 2012, in part thanks to wage rises.

During the same period in France, wages have hardly risen, which is not surprising given the stumbling state of the economy.

But another major factor has been the introduction of the CICE tax credit on competitiveness and employment which has helped French companies lower costs as well as the controversial Responsibility Pact, which saw several payroll charges cut in the hope it would boost recruitment.

For example companies no longer have to pay social security costs for those workers employed on a minimum wage.

However it wasn’t all positive news for France. With other sectors added in, such as the service industry and construction, labour costs remain more expensive in France than much of Europe including their neighbours across the Rhine.

On average a French worker costs €34.60 per hour compared to €31.40 per hour in Germany.

When it comes to Europe as a whole France lies in sixth place, far behind table toppers Norway where the average cost to employ someone stands at €54 an hour.

Next came Denmark where workers cost €40.30 an hour and then Belgium on €39, before Sweden on €35.49.

Bottom of the ranking came Bulgaria where the average cost of employing someone is €3.80 per hour.

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