France economy: Flea market traders 'pessimistic'
- 14 August 2013
- From the section Business
Les Puces de Saint-Ouen is a bargain hunter's paradise. It is the original, and some say the biggest, flea market in the world.
You can find anything in Saint-Ouen. There are 2,500 traders selling anything from second-hand clothes to the finest antique furniture.
But right now, the traders are setting up more in hope than with any great expectations of making a profit.
Alec Zimeris sells antique paintings. He is marooned in a covered market. The stalls around him are shuttered and locked. Many of his fellow tenants, he says, are on the brink.
"They are quite pessimistic, because they own the lease to the shop, they bought it and now they are unable to sell it. And sometimes they have to abandon the stall because they can't afford to keep up the rent," he says.
"We have fewer and fewer people who come to browse. We used to see the same faces several times a month - they would buy a painting at least once a year.
"But we have seen a drop of 75% in the number of customers. When you consider that one in 10 of those visitors would buy a painting - you see the problem."
August is the time when many leave the city, but in years gone by at least a third of the shops around Alec would remain open. Today, the shutters tell the story. They epitomise the state of the French economy.
Yet some weeks ago President Hollande was boldly predicting the worst was over. "The recovery is there. I won't embellish the data, but it is there," he said.
"Industrial production is restarting and in the last three months it has taken off faster than in many other European countries."
Industrial output did rise over three months in the spring, but it disappeared just as quickly.
The figures across the board reflect the reality.
Take restaurants. France is famous for its cuisine yet the number of people dining in restaurants in July fell by 13% on the same month last year.
Twinned with the decline in consumer spending - down 0.8% in June - they are figures that show the fragility of any so-called recovery.
Perhaps the most important indicator, though, is the unemployment rate, which over two years marched steadily to a record high of 11% in June.
Ask employers and they will tell you it is a systemic problem, not a cyclical blip. Many new jobs are on temporary contracts, which does give employers more flexibility, but it often ends with the worker returning to the unemployment roll.
Gregory Herbe runs a start-up called MyJobCompany. They are internet headhunters who list employment contracts from France, the UK and Latin America.
They have only been going a year, and already have 25,000 subscribers. It is a hi-tech business, the kind the government wants to encourage. And perhaps in the field they work in, they are a fair barometer of the general mood.
"We are seeing more positive signs," says Gregory. "A lot of the companies have gone through the last three or four years laying people off. They've been saving money. Some are sitting on a pile of cash, ready to employ.
"But still it is not evolving into a sudden spike in business. People are waiting."
And what about Gregory's business itself?
"We have had some help," he says. "But taxes are too high and we'd like to see more in the shape of labour reform.
"Employing people in France on a full-time contract is more dangerous than marrying someone you have never met," he laughs.
There is a serious side. Just a year into business, and the three partners of the company have already considered moving to London.
"In the UK there's a better climate for business," says Gregory. "It helps that our business is portable. Our programmers work on laptops. And if you asked our employees most would say they are happy to go too."
This is just one of the reasons why the employers' association, Medef, remains cautious. The union's president for the Paris region, Marie-Christine Oghly, says another rise in taxes would strangle France's anaemic recovery.
"Our companies are not competitive because of the high level of social charges and taxes. If we want to export we have to be competitive and right now our labour costs are too high," she says,
"Yes we have stopped the recession. It's not getting worse. Perhaps our export balance also looks a little healthier.
"But still the deep reforms we need have not been passed, our deficit remains high, and until we cut spending we won't be on the right path."
Mr Hollande has pledged to cut unemployment by the end of the year. Eighty-two per cent of people say they do not believe him. Right now it is not hope he is inspiring but deep cynicism.
The most precious commodity going at the moment is confidence. And it is about the only thing you will not find on the stalls of Saint-Ouen.