Economy of Paris

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Paris as an engine of the global economy: the skyscrapers of La Défense (in the background), the largest purpose-built business district of Europe, with 3.35 million m² (36 million sq. ft) of office space.[1]

Paris, the capital and largest city of France, is one of the engines of the global economy. In 2009, the GDP of the Paris Region as calculated by INSEE was US$769.7 billion at market exchange rates.[2] If it were a country, in 2007, the Paris Region would be the 17th-largest economy in the world, with an economy larger than that of the Netherlands or Turkey.[3][4] In 2009, an Internet survey also rated Paris as one of the world's most expensive cities in which to purchase goods and services.[5]

Although in terms of population the urban area of Paris is only approximately the 20th largest urban area in the world, its GDP is the sixth-largest in the world, after the urban areas of Tokyo, New York,Los Angeles,Chicago and London. The GDP and income per capita is one of the highest in the world; the Paris urban area concentrates more than 30% of France's wealth. In 2009, the GDP per capita (PPP) was $46.800 for 9.82 million people. The average income was 56.980$ in 2009, 41% higher than in the rest of the country. Paris is one of few economic areas that didn't have any GDP decrease during the financial crisis in 2008; the GDP increased all over the period.[6]

The Paris economy is extremely diverse and has not yet adopted a specialization inside the global economy (unlike Los Angeles with the entertainment industry, or London and New York with financial services). Today, it is essentially a service economy, with business and financial services generating nearly half of the Paris region's GDP.[7] Its manufacturing base has declined since its pre-1970s heyday, generating now less than 10% of the region's GDP,[7] even though the Paris Region still remains one of the manufacturing powerhouses of Europe due to the sheer size of its economy, with a shift from traditional to high-tech manufacturing.

Paris GDP[edit]

Economically speaking, the agglomeration of Paris is among the largest economic centers in the world, with the sixth-largest gross metropolitan product in the world in 2008 according to a study by PricewaterhouseCoopers whose main results are shown in the table below.[6]

Urban agglomerations 2008 GDP
(in billion US$)
(at purchasing power parity)
01- Tokyo 1.479
02- New York 1.406
03- Los Angeles 792
04- London 723
05- Chicago 574
06- Paris 565
07- Osaka-Kobe 417
08- Mexico City 390
09- São Paulo 388
10- Philadelphia 388

Year in, year out, the Paris Region accounts for 28 to 29% of the total GDP of metropolitan France,[2] although its 2007 population is only 18.8% of the total population of metropolitan France.[8] According to Eurostat, the GDP of the Paris Region accounted alone for 4.4% of the total GDP of the European Union (of 27 members) in the year 2005,[9] although its population is only 2.3% of the total population of the EU27.

Fortune Global 500 companies[edit]

In 2008, Paris hosted the world headquarters of twenty-five Fortune Global 500 companies (the 500 largest corporations in the world by revenue, ranked every year by Fortune magazine) with a combined revenue of 1,420 billion US dollars in the fiscal year 2007-2008. This is more Fortune Global 500 companies and a larger combined revenue than any city in the world except Tokyo as shown in the table below.[10]

Rank City Country Number of Global 500
companies
Global 500
revenues ($ millions, FY 07-08)
1 Tokyo Japan 47 1,858,608
2 Paris France 38 1,419,933
3 London United Kingdom 22 1,183,769
4 Beijing China 21 943,768
5 New York United States 20 1,166,469
6 Seoul South Korea 13 576,919
7 Toronto Canada 9 229,308
8 Madrid Spain 8 357,927
9 Munich Germany 7 455,821
9 Zurich Switzerland 7 354,657
9 Osaka Japan 7 267,296
10 Houston United States 6 344,028


Twelve Fortune Global 500 companies are also headquartered in the inner and outer suburbs of Paris, notably in the business district of La Défense, thus giving a total of thirty-seven Fortune Global 500 companies whose world headquartered are located within the Paris Region. Here is a list of these thirty-seven companies:

Fortune Global 500 companies headquartered in the Paris Region (in 2008)[11]
Local rank FG 500 rank Company name Industry Revenues ($ millions, 2011) Location
1 11 Total Petroleum Refining 187,280 La Défense
2 14 AXA Insurance: Life, Health (stock) 162,762 8th arrondissement
3 26 BNP Paribas Banks: Commercial and Savings 140,727 9th arrondissement
4 32 Carrefour Food and Drug Stores 120,297 Levallois-Perret
5 38 Suez Energy 111,888 8th arrondissement
6 43 Crédit Agricole Banks: Commercial and Savings 105,003 15th arrondissement
7 68 EDF Utilities (electricity) 89,629 8th arrondissement
8 72 Société Générale Banks: Commercial and Savings 84,350 9th arrondissement
9 90 Peugeot Motor vehicles and Parts 82,965 16th arrondissement
10 97 Group BPCE Banks : Commercials and savings 69,297 13th arrondissement of Paris
11 130 Orange Telecommunications 61,965 15th arrondissement
12 142 CNP Assurances Insurance: Life, Health (stock) 53,136 15th arrondissement
13 155 Saint-Gobain Building materials, Glass 55,684 La Défense
14 163 Renault Motor : vehicles and parts 51,616 Boulogne-Billancourt
15 175 Veolia Environnement Utilities 47,750 16th arrondissement
16 187 Sanofi-Aventis Pharmaceuticals 45,056 13th arrondissement
17 192 Vinci Engineering, Construction 41,969 Rueil-Malmaison
18 206 Bouygues Engineering, Construction 41,721 8th arrondissement
19 209 SNCF Railroads 40,575 14th arrondissement
20 217 Foncière Euris General Merchandisers, Commercial Real Estate 39,449 8th arrondissement
21 225 Vivendi Telecommunications, Entertainment 38,248 8th arrondissement
22 306 La Poste Mail, Package, Freight Delivery 31,947 15th arrondissement
23 308 Air France-KLM Airlines 31,200 Paris CDG Airport
24 344 Christian Dior Apparel 28,604 8th arrondissement
25 348 Alstom Industrial Equipment (power generation, trains) 27,927 Levallois-Perret
26 374 Schneider Electric Electronics, Electrical Equipment 25,933 Rueil-Malmaison
27 378 L'Oréal Household and Personal Products 25,821 Clichy
28 420 Groupama Insurance: P&C (mutual) 23,144 8th arrondissement
29 421 PPR General Merchandisers (luxury goods) 22,907 16th arrondissement
30 433 Groupe Danone Food Consumer Products 20,128 9th arrondissement
31 455 Lafarge Building materials, Glass 21,415 16th arrondissement
32 461 Alcatel-Lucent Network and Other Communications Equipment 21,186 8th arrondissement
33 470 Sodexo Food Services 20,794 Issy-les-Moulineaux
Note: The Franco-German aerospace company EADS has its dual world headquarters in Paris and Munich but it is not listed here because
Fortune magazine considered it was located in the Netherlands, which is the place where EADS was legally incorporated for tax reasons.

Spatial organisation of the Paris economy[edit]

At the 1999 census, there were 5,089,179 persons employed in the Paris aire urbaine (or "metropolitan area").[12] At the same 1999 census, 4,949,306 people living in the Paris aire urbaine had a job.[13] The almost 140,000 people difference between these two figures comes from an outflow of about 60,000 people living inside the aire urbaine who work outside of it, and an inflow of about 200,000 people living outside of the aire urbaine who come to work inside it every day. Thus, out of the 5,089,179 people employed in the Paris aire urbaine in 1999, only about 200,000 people (3.9% of the total) lived outside of it, which is not surprising since the boundaries of the aires urbaines are based on commuting patterns.

Well into the middle of the 20th century, the majority of jobs in the aire urbaine were concentrated in the city of Paris proper. However, after the Second World War the economic activity relocated to the suburbs, and the city has been steadily losing jobs to the benefit of the suburbs, in particular the Hauts-de-Seine (92) département, home of the new La Défense business district, to the west of the city proper. Today, the city of Paris is not properly speaking the economic centre of the aire urbaine since most of the offices are in fact located in the western half of the city proper and in the central portion of the Hauts-de-Seine département, forming a triangle between the Opéra, La Défense and the Val de Seine district. Hauts-de-Seine has become a sort of extension of central Paris, with 873,775 persons employed there in the end of 2005, more than half as many as in the city of Paris proper (1,653,551 persons employed in the city of Paris in the end of 2005).[14]

As a consequence workers do not just commute from the suburbs to work in the city of Paris, but also come from the city of Paris to work in the suburbs. Of the 5,416,643 persons employed in the Paris Region in the end of 2005, only 1,653,551 (30.5%) worked inside the city of Paris proper, while 3,763,092 (69.5%) worked in the suburbs. However, once adding Hauts-de-Seine, the previous figures show that City of Paris and Hauts-de-Seine together still harboured 46.7% of all persons employed in the Paris Region in the end of 2005, which should help to put into perspective the phenomenon of job relocation to the suburbs: it was as much a relocation to the suburbs as an extension of central Paris beyond the administrative borders of the city.

During the 1960s and 1970s, the French government created several villes nouvelles ("new towns") on the outer ring of the Paris suburbs in order to multi-polarise the economy of the city. Economically speaking, those villes nouvelles have been a relative success since many companies are still moving into those areas today. However, they didn't completely fulfil their role of multi-polarisation: economic activities still remain in a large measure concentrated in the central core (City of Paris and Hauts-de-Seine) of the aire urbaine, as the above employment figures show.

Sectors of the Paris economy[edit]

The figures below, extracted from the 1999 census,[15] show the distribution of the 5,089,179 persons employed in the Paris aire urbaine across the different economic sectors in the year 1999. This will give a sense of the extreme diversity of the Paris economy, marked nonetheless by the notable dominance of services.

  • Primary sector: Agriculture, forestry, and fishing: 26,741 persons in employment (0.5% of total workforce)
  • Secondary sector: Manufacturing and mining, construction, and utilities: 913,503 p. in emp. (17.9% of t. wf)
    • Manufacturing (includes mining and oil and gas extraction): 627,534 p. in emp. (12.3% of t. wf)
      The manufacturing industries employing most people are:
      • Electronic and electrical equipment, appliances, and components: 112,281 p. in emp. (2.2% of t. wf)
        This branch is made of: computers and peripheral equipment; mobile phones; radio and television broadcasting and wireless communications equipment; semiconductors and other electronic components; navigational, measuring, electro-medical, and control instruments; electrical engines; electric lighting equipment; miscellaneous electrical equipment (cables, transformers, switchboards, etc.). This branch DOES NOT include household electronic and electrical appliances (televisions, radios, DVD players, ovens, refrigerators, watches, clocks, etc.).
      • Publishing, printing, and reproduction of recorded media: 87,599 p. in emp. (1.7% of t. wf)
        Books, newspapers, magazines, etc. This branch DOES NOT include the motion picture and sound recording industries, neither does it include the broadcasting industries.
      • Foodstuff, beverages, and tobacco products manufacturing: 59,862 p. in emp. (1.2% of t. wf)
      • Machinery and equipment manufacturing: 56,270 p. in emp. (1.1% of t. wf)
        This branch is made of: engine, turbine, and power transmission equipment; pumps and compressors; material handling equipment; ventilation, heating, air-conditioning, and commercial refrigeration equipment; agriculture, construction, and mining machinery; machine tools; industrial moulds; industrial machinery (plastics and rubber industry machinery, textile machinery, etc.); and other general purpose machinery (welding and soldering equipment, industrial process furnaces and ovens, scales and balances (except laboratory), etc.). This branch DOES ALSO INCLUDE three industries generally listed under "Fabricated metal products manufacturing" in Anglo-Saxon classifications: architectural and structural metals manufacturing; boilers, tanks, and shipping containers; and arms and ammunitions.
      • Motor vehicles, trailers, and motor vehicle parts manufacturing ("car industry"): 52,149 p. in emp. (1.0% of t. wf)
    • Construction: 235,872 p. in emp. (4.6% of t. wf)
    • Utilities: Electricity, natural gas and water supply: 50,097 p. in emp. (1.0% of t. wf)
  • Tertiary sector: Services: 4,148,935 p. in emp. (81.6% of t. wf)
    The services employing most people are:
    • Business services (include rental and leasing services): 841,157 p. in emp. (16.5% of t. wf)
      • Professional and technical services: 509,048 p. in emp. (10.0% of t. wf)
        This branch is made of: computer systems design and related services; data processing, hosting, and related services; software publishing; legal services; accounting, tax preparation, bookkeeping, and payroll services; management of companies and enterprises; administrative management and general management consulting; human resources and executive search consulting; marketing consulting; process, physical distribution, and logistics consulting; environmental consulting; advertising and related services; and architectural, engineering, and related services.
      • Administrative, support, and waste management services: 272,981 p. in emp. (5.4% of t. wf)
        This branch is made of: employment services (placement, temporary); investigation and security services; services to buildings and dwellings; photographic services; office administrative services; translation and interpretation services; business support services (call centres, collection agencies, etc.); packaging and labelling services; convention and trade show organisers; and waste management and remediation services. This branch DOES ALSO INCLUDE renting and leasing of machinery and equipment without operator and of personal and household goods, which is generally listed along with "Real estate" in Anglo-Saxon classifications.
      • Research and development: 59,128 p. in emp. (1.1% of t. wf)
    • Commerce: 660,843 p. in emp. (13.0% of t. wf)
      • Retail trade (except of motor vehicles) and repair: 308,323 p. in emp. (6.1% of t. wf)
      • Wholesale and commission trade (except of motor vehicles): 276,282 p. in emp. (5.4% of t. wf)
      • Sale, maintenance, and repair of motor vehicles: 76,238 p. in emp. (1.5% of t. wf)
    • Public administrations and defense: 510,972 p. in emp. (10.0% of t. wf)
    • Health services and social assistance: 451,373 p. in emp. (8.7% of t. wf)
    • Transportation, storage, and communications: 419,779 p. in emp. (8.2% of t. wf)
      This branch is made of: public and private transportation of passengers and freight; warehousing and storage; travel agencies; post and couriers; and telecommunications.
    • Education: 334,852 p. in emp. (6.6% of t. wf)
    • Finance and insurance: 256,722 p. in emp. (5.0% of t. wf)
    • Accommodation and food services (hotels and restaurants): 202,228 p. in emp. (4.0% of t. wf)

Manufacturing[edit]

Business services[edit]

Commerce and finance[edit]

Commerce: 660 843 employees Retail stores (except automobiles) and repair: 308 323 employees Wholesale and commissions (except cars): 276 282 employees Sale, maintenance, and repair of automobiles: 76,238 employees Public administration and defense: 510 972 employees

See also[edit]

References[edit]

  1. ^ (French) Paris Chamber of Commerce and Industry, Contribution des CCI de Paris - Ile-de-France à la révision du SDRIF, page 110. "TEM Paris – La Défense – QCA" (PDF). Archived from the original on 2007-03-02. Retrieved 2007-09-01. 
  2. ^ a b (French) Institut National de la Statistique et des Études Économiques. "Produits Intérieurs Bruts Régionaux (PIBR) en valeur en millions d'euros" (XLS). Retrieved 2008-10-22. 
    €552,050 million according to the INSEE Excel table, i.e. US$772.8 billion at current exchange rates, using the 2007 euro/dollar exchange rate used by the IMF.
  3. ^ World Bank. "Total GDP 2007". Retrieved 2008-10-22. 
  4. ^ http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP.pdf
  5. ^ "Cost of living Index". 
  6. ^ a b PricewaterhouseCoopers, "UK Economic Outlook, March 2007", page 5. "Table 1.2 – Top 30 urban agglomeration GDP rankings in 2005 and illustrative projections to 2020 (using UN definitions and population estimates)" (PDF). Archived from the original on 2007-06-10. Retrieved 2007-03-09. 
  7. ^ a b Regional Chamber of Commerce and Industry of Paris - Île-de-France, "Paris region : Key Figures 2007", page 16. "Value added by sector" (PDF). Archived from the original on 2007-09-27. Retrieved 2007-09-01. 
  8. ^ "Population des régions aux derniers recensements". Institut National de la Statistique et des Études Économiques (in French). Retrieved 2008-10-22. 
  9. ^ Eurostat (2008-02-12). "Regional GDP in the European Union, 2005" (PDF). Retrieved 2008-03-08. 
  10. ^ Fortune magazine (2008-07-21). "Fortune Global 500 - Top cities". CNN. Retrieved 2008-07-28. 
  11. ^ Fortune magazine (2008-07-21). "Fortune Global 500 - France". CNN. Retrieved 2008-07-28. 
  12. ^ (French) INSEE, Government of France. "1999 French census, Total employment at workplace by gender, age, and employment status in the aire urbaine of Paris". Retrieved 2007-09-01. 
  13. ^ (French) INSEE, Government of France. "1999 French census, Economically active population by gender, age, and activity status in the aire urbaine of Paris". Retrieved 2007-09-01. 
  14. ^ (French) INSEE Ile-de-France, Government of France. "Estimations d'emploi salarié et non salarié par secteur d'activité et par département au 31 décembre". Retrieved 2007-09-01. 
  15. ^ (French) INSEE, Government of France. "1999 French census, Total employment at workplace by gender, employment status, and economic sector in the aire urbaine of Paris". Retrieved 2007-09-01. 

External links[edit]