Companies in the United States may have trouble finding skilled employees, but France has the opposite problem: high unemployment.
While many U.S. cities register an unemployment rate around 3 percent, Eurostat pegs France's at nearly 12 percent, and 22.5 percent for people age 25 and under.
The nation has had its share of work force problems, egged on by a huge bureaucracy, trade unions and pro-labor laws.
Still, France offers a number of advantages to business.
Want Evidence?
Foreign investment in France reached a 10-year peak in 1998 when 445 projects were announced, up 23 percent from 1997.
These investments are expected to create or preserve over 29,400 jobs in the next three years, 21.5 percent more than in 1997.
| The Port of Le Harve is expanding its large-ship receiving capabilities and developing an industrial park that gives manufacturers easy access to road and rail networks, a logistics center and duty-free warehousing. |
The number of jobs created by North American investment projects more than doubled in 1998, increasing by 107 percent over 1997. As a result, the United States regained its No. 1 ranking on the roster of nations investing in France, a position it had relinquished to Germany in 1997.
Synbiotics, an American biopharmaceutical company, is just one example of a firm that has found a French location to be a launching pad for success in Europe.
"We had concerns about France's well publicized labor situation, but this has not been an obstacle to doing business," says Kenneth Cohen, president and CEO of Synbiotics.
"In fact, we've found our French work force to be very capable, flexible, and dedicated to the worldwide success of our entire company. It's also turned out that, while the structure is different, the total cost of employing someone in France is similar to the cost of San Diego."
Auto Sector Prominence
Among France's leading industrial sectors is the automotive industry.
Included in the list of major U.S. manufacturing projects for 1998 was Oxford Automotive of Troy, Mich., which signed an agreement to purchase Cofimeta, the third largest stamping and metal forming company in France with annualized sales of about $200 million.
The auto components manufacturer makes just-in-time deliveries to companies such as Renault SA, PSA Peugeot Citroen, Toyota, Volkswagen, BMW and Nissan.
"France is established as the second-largest manufacturer of automobiles in Europe," says Steve Abelman, president and CEO of Oxford Automotive. "With the acquisition of Cofimeta, Oxford Automotive, Inc. has established the platform on which to grow in Europe."
The company has facilities in Douai, St. Florent and Orbec.
"These French manufacturing facilities provide Oxford Automotive with immediate benefits, most importantly a well-trained labor force, an expanded global customer base and an ease of access to European markets," says Abelman.
Company plans call for constructing a new technical center near Paris that will provide advanced engineering, design, program management and other services.
In 1997, Toyota committed to building a facility in the Nord-Pas de Calais region, the largest foreign direct investment project in Europe that year.
High-tech Takes Off
France is host to almost a quarter of Europe's software market, and many U.S. software firms have entered into joint-venture agreements with French software service firms.
Foreign Investment in France
Investment in France from multinational companies reached a 10-year high in 1998, with 445 project announcements.
1998 foreign investment plans will result in the creation or retention of nearly 30,000 jobs in France over the next three years.
The number of jobs created or retained due to North American companies' investments more than doubled in 1998. A total of 8,782 jobs will be created by 111 projects.
The United States is the world's leading country in terms of foreign business investment in France.
North American projects accounted for 30 percent of the new jobs created by business investment in France in 1998.
Source: Invest in France Agency |
Some, such as Cadence Design Systems, have flocked to Sophia Antipolis Park, near Nice, to focus on research and development.
Another software company, the French firm Dynalis, recently opened a new facility in the Toulouse/ Midi-Pyrenees region.
The company, which specializes in the design, development, and distribution of aerospace/defense software, expects to employ additional workers at its Toulouse-Blagnac facility within three years.
Dynalis selected the Toulouse area to be near the city's aerospace industry.
Toulouse is home to the consortium headquarters of Airbus Industrie, the world's second-largest producer of large capacity aircraft.
The Midi-Pyrenees region is home to numerous other high-tech companies that have been fed by a strong university system.
The region is home to 108,000 students, with three universities -- including Toulouse University -- a national polytechnic institute and 14 graduate engineering schools.
StorageTek, a leader in data storage systems, located to the region in the early '90s.
"We chose Toulouse, mainly for the human factor," said Victor Perez, president of industrial production. "A number of laboratories in the region are doing research in information technology. A region with such a highly qualified work force and such a good industrial environment is obviously an advantage."
Airport Area Development
The area known as Aeroports de Paris is expanding at a rapid clip as companies locate near the Paris-Charles de Gaulle/ Roissy Airport.
Dirham Express of New York City has opened an office in Garges-les-Gonesse, near the Charles de Gaulle Airport.
The company, which specializes in bank transfers to and from Northern Africa, is also opening additional offices in the Lyon and Lille areas as the company expands its activities with fund transfers to and from the Middle East.
Expansions are underway as well at Charles de Gaulle Airport. Air France has upgraded its cargo handling facilities to the tune of $65 million. Its state-of-the-art cargo hub is now Europe's largest. United Parcel Service plans to open new operations there as well.
To encourage the growth of logistics companies, the French government introduced new tax measures for logistics centers and improved customs procedures in 1997.
While labor and regulatory issues can prove challenging, France offers businesses a skilled work force and a strategic platform from which to reach Europe's powerful marketplace.
Karen E. Thuermer is a Berwyn, Pa.,-based freelance writer.
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