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.[1]

Paris, the capital and largest city of France, is one of the engines of the global economy. In 2012, the GDP of the Paris Region as calculated by INSEE was 624 billion Euros. [2] In 2009, an Internet survey rated Paris as one of the world's most expensive cities in which to purchase goods and services.[3]

Although in terms of population the urban area of Paris is only approximately the 20th largest urban area in the world, its GDP of the Paris Region is the sixth-largest in the world, after Tokyo, New York, Los Angeles, Chicago and London. The GDP and income per capita is one of the highest in the world; the Paris region accounts for 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.[4]

The Paris economy is essentially a service economy, with business and financial services generating nearly half of the Paris region's GDP.[5] Its manufacturing base has declined since its pre-1970s heyday, generating now less than 10% of the region's GDP,[5] even though the Paris Region still remains one of the manufacturing centers 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 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.[4]

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,[6] although its 2007 population is only 18.8% of the total population of metropolitan France.[7] 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,[8] although its population is only 2.3% of the total population of the EU27.

Fortune Global 500 companies

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.[9]

RankCityCountryNumber of Global 500
companies		Global 500
revenues ($ millions, FY 07-08)
1TokyoJapan471,858,608
2ParisFrance381,419,933
3LondonUnited Kingdom221,183,769
4BeijingChina21943,768
5New YorkUnited States201,166,469
6SeoulSouth Korea13576,919
7TorontoCanada9229,308
8MadridSpain8357,927
9MunichGermany7455,821
9ZurichSwitzerland7354,657
9OsakaJapan7267,296
10HoustonUnited States6344,028


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)[10]
Local rankFG 500 rankCompany name Industry Revenues ($ millions, 2011)Location
1 11 Total Petroleum Refining 187,280La Défense
2 14 AXA Insurance: Life, Health (stock) 162,7628th arrondissement
3 26 BNP Paribas Banks: Commercial and Savings 140,7279th arrondissement
4 32 Carrefour Food and Drug Stores 120,297Levallois-Perret
5 38 Suez Energy 111,8888th arrondissement
6 43 Crédit Agricole Banks: Commercial and Savings 105,00315th arrondissement
7 68 EDF Utilities (electricity) 89,6298th arrondissement
8 72 Société Générale Banks: Commercial and Savings 84,3509th arrondissement
9 90 Peugeot Motor vehicles and Parts 82,96516th arrondissement
10 97 Group BPCE Banks : Commercials and savings 69,29713th arrondissement of Paris
11 130 Orange Telecommunications 61,96515th arrondissement
12 142 CNP Assurances Insurance: Life, Health (stock) 53,13615th arrondissement
13 155 Saint-Gobain Building materials, Glass 55,684La Défense
14 163 Renault Motor : vehicles and parts 51,616Boulogne-Billancourt
15 175 Veolia Environnement Utilities 47,75016th arrondissement
16 187 Sanofi-Aventis Pharmaceuticals 45,05613th arrondissement
17 192 Vinci Engineering, Construction 41,969Rueil-Malmaison
18 206 Bouygues Engineering, Construction 41,7218th arrondissement
19 209 SNCF Railroads 40,57514th arrondissement
20 217 Foncière Euris General Merchandisers, Commercial Real Estate 39,4498th arrondissement
21 225 Vivendi Telecommunications, Entertainment 38,2488th arrondissement
22 306 La Poste Mail, Package, Freight Delivery 31,94715th arrondissement
23 308 Air France-KLM Airlines 31,200Paris CDG Airport
24 344 Christian Dior Apparel 28,6048th arrondissement
25 348 Alstom Industrial Equipment (power generation, trains) 27,927Levallois-Perret
26 374 Schneider Electric Electronics, Electrical Equipment 25,933Rueil-Malmaison
27 378 L'Oréal Household and Personal Products 25,821Clichy
28 420 Groupama Insurance: P&C (mutual) 23,1448th arrondissement
29 421 PPR General Merchandisers (luxury goods) 22,90716th arrondissement
30 433 Groupe Danone Food Consumer Products 20,1289th arrondissement
31 455 Lafarge Building materials, Glass 21,41516th arrondissement
32 461 Alcatel-Lucent Network and Other Communications Equipment 21,1868th arrondissement
33 470 Sodexo Food Services 20,794Issy-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

At the 1999 census, there were 5,089,179 persons employed in the Paris aire urbaine (or "metropolitan area").[11] At the same 1999 census, 4,949,306 people living in the Paris aire urbaine had a job.[12] 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).[13]

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,[14] 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.

Commerce and finance

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

References

  1. ↑ 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) (in French). Archived from the original on 2007-03-02. Retrieved 2007-09-01.
  2. ↑ INSEE. "GDP of IDF in 2012" (in French). Retrieved 2015-04-01.
  3. ↑ "Cost of living Index".
  4. ↑ 4.0 4.1 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.
  5. ↑ 5.0 5.1 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.
  6. ↑ Institut National de la Statistique et des Études Économiques. "Produits Intérieurs Bruts Régionaux (PIBR) en valeur en millions d'euros" (XLS) (in French). 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.
  7. ↑ "Population des régions aux derniers recensements". Institut National de la Statistique et des Études Économiques (in French). Retrieved 2008-10-22.
  8. ↑ Eurostat (2008-02-12). "Regional GDP in the European Union, 2005" (PDF). Retrieved 2008-03-08.
  9. ↑ Fortune magazine (2008-07-21). "Fortune Global 500 - Top cities". CNN. Retrieved 2008-07-28.
  10. ↑ Fortune magazine (2008-07-21). "Fortune Global 500 - France". CNN. Retrieved 2008-07-28.
  11. ↑ INSEE, Government of France. "1999 French census, Total employment at workplace by gender, age, and employment status in the aire urbaine of Paris" (in French). Retrieved 2007-09-01.
  12. ↑ INSEE, Government of France. "1999 French census, Economically active population by gender, age, and activity status in the aire urbaine of Paris" (in French). Retrieved 2007-09-01.
  13. ↑ INSEE Ile-de-France, Government of France. "Estimations d'emploi salarié et non salarié par secteur d'activité et par département au 31 décembre" (in French). Retrieved 2007-09-01.
  14. ↑ INSEE, Government of France. "1999 French census, Total employment at workplace by gender, employment status, and economic sector in the aire urbaine of Paris" (in French). Retrieved 2007-09-01.

External links