Economy of Paris

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.

Paris is one of the engines of the global economy. In 2006 the GDP of the Paris Region as calculated by INSEE was US$628.9 billion at current exchange rates. If it were a country, the Paris Region would be the 17th largest economy in the world (as of 2006), with an economy nearly as large as that of the Netherlands.

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 fifth-largest in the world after the urban areas of Tokyo, New York, Los Angeles, and Chicago.

The Paris economy is extremely diverse and has not yet adopted a specialisation 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. Its manufacturing base has declined since its pre-1970s heyday, generating now less than 10% of the region's GDP, 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

Economically speaking, the agglomeration of Paris is among the largest economic centres in the world, with the fifth-largest gross metropolitan product in the world in 2005 according to a study by PricewaterhouseCoopers whose main results are shown in the table below.

Urban agglomerations	2005 GDP (in billion US$) (at purchasing power parity)
01- Tokyo	1,191
02- New York	1,133
03- Los Angeles	639
04- Chicago	460
05- Paris	460
06- London	452
07- Osaka-Kobe	341
08- Mexico City	315
09- Philadelphia	312
10- Washington	299

Year in, year out, the Paris Region accounts for 28 to 29% of the total GDP of metropolitan France, although its 2006 population is only 18.8% of the total population of metropolitan France. 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, although its population is only 2.3% of the total population of the EU27.

Fortune Global 500 companies

As of 2008, the City of Paris hosts 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.

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	25	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	Zürich	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)

Local rank	FG 500 rank	Company name	Industry	Revenues ($ millions, FY 07-08)	Location
1	8	Total	Petroleum Refining	187,280	La Défense
2	15	AXA	Insurance: Life, Health (stock)	162,762	8th arrondissement
3	21	BNP Paribas	Banks: Commercial and Savings	140,727	9th arrondissement
4	23	Crédit Agricole	Banks: Commercial and Savings	138,155	15th arrondissement
5	33	Carrefour	Food and Drug Stores	115,585	Levallois-Perret
6	43	Société Générale	Banks: Commercial and Savings	103,443	9th arrondissement
7	66	Peugeot	Motor vehicles and Parts	82,965	16th arrondissement
8	68	EDF	Utilities (electricity)	81,629	8th arrondissement
9	84	France Télécom	Telecommunications	72,488	15th arrondissement
10	97	Suez	Energy	64,983	8th arrondissement
11	110	Saint-Gobain	Building materials, Glass	59,433	La Défense
12	112	CNP Assurances	Insurance: Life, Health (stock)	59,071	15th arrondissement
13	119	Renault	Motor vehicles and Parts	55,684	Boulogne-Billancourt
14	124	Groupe Caisse d'Epargne	Banks: Commercial and Savings	53,992	13th arrondissement
15	153	Veolia Environnement	Utilities	44,750	16th arrondissement
16	169	Vinci	Engineering, Construction	41,969	Rueil-Malmaison
17	172	Bouygues	Engineering, Construction	40,721	8th arrondissement
18	178	Sanofi-Aventis	Pharmaceuticals	39,977	13th arrondissement
19	193	GDF	Utilities (natural gas)	37,541	17th arrondissement
20	205	Foncière Euris	General Merchandisers, Commercial Real Estate	36,115	8th arrondissement
21	222	Air France-KLM	Airlines	34,130	Paris CDG Airport
22	233	SNCF	Railroads	32,427	14th arrondissement
23	239	La Poste	Mail, Package, Freight Delivery	31,947	15th arrondissement
24	264	Vivendi	Telecommunications, Entertainment	29,643	8th arrondissement
25	284	PPR	General Merchandisers (luxury goods)	28,107	16th arrondissement
26	314	Groupama	Insurance: P&C (mutual)	25,811	8th arrondissement
27	325	Alcatel-Lucent	Network and Other Communications Equipment	24,645	8th arrondissement
28	333	Lafarge	Building materials, Glass	24,109	16th arrondissement
29	338	Alstom	Industrial Equipment (power generation, trains)	23,927	Levallois-Perret
30	342	Schneider Electric	Electronics, Electrical Equipment	23,691	Rueil-Malmaison
31	346	Christian Dior	Apparel	23,604	8th arrondissement
32	355	L'Oréal	Household and Personal Products	23,355	Clichy
33	421	CIC	Banks: Commercial and Savings	20,193	9th arrondissement
34	423	Groupe Danone	Food Consumer Products	20,128	9th arrondissement
35	473	Sodexo	Food Services	17,673	Issy-les-Moulineaux
36	488	Eiffage	Engineering, Construction	17,241	Asnières-sur-Seine
37	498	Thales Group	Aerospace and Defense	16,830	Neuilly-sur-Seine
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

As of the 1999 census, there were 5,089,179 persons employed in the Paris aire urbaine (or "metropolitan area"). At the same 1999 census, 4,949,306 people living in the Paris aire urbaine had a job. 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).

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

The figures below, extracted from the 1999 census, 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)

External links

• Template:En icon Paris Region Economic Development Agency
• Template:Fr icon Regional Chamber of Commerce and Industry of Paris - Île-de-France
  • Template:En icon Paris Region: Key figures 2007 – 2007 economic report published by the Regional Chamber of Commerce and Industry of Paris - Île-de-France
• Template:Fr icon CROCIS: Commerce, Industry, and Services Regional Observation Center – research and study department of the Paris Chamber of Commerce and Industry gathering data and statistics on the economy of the Paris Region (Greater Paris)
• Template:En icon Paris-Ile de France Capitale Economique – non-profit organization created by the Paris Chamber of Commerce and Industry and made up of French companies and professional organizations aiming at promoting Greater Paris economic strengths
• Template:En icon Paris Développement – economic development agency of the city of Paris
• Template:En icon IAURIF: Institute for Urban Planning and Development of the Paris Île-de-France Region
• Template:Fr icon L'industrie en Île-de-France – a website about the manufacturing industries in the Paris Region
• Template:Fr icon Comité Mécanique Île-de-France – a website about the mechanical industries in the Paris Region
• Template:Fr icon Regional Agency for Technologies and Information Society
• Template:Fr icon DRIRE Île-de-France – website of the regional division of the French Ministry of Economy, Finance, and Employment for the Paris Region
• Template:Fr icon Economic and Social Council of the Paris Île-de-France Region
• Template:Fr icon INSEE Île-de-France – website of the regional division of INSEE for the Paris Region