25 Feb Working It Out
France and the United States’ often tempestuous relationship hit another sour note this week after the CEO of Titan Tire company sent a letter to Arnaud Montebourg, the French Minister of Industry, in which he clearly and very undiplomatically lays out the reasons that Titan Tire will not be taking over a struggling Goodyear factory in the French city of Amiens. The CEO, Maurice Taylor, writes:
I have visited that factory a couple of times. The French workforce gets paid high wages but works only three hours. They get one hour for breaks and lunch, talk for three and work for three. I told this to the French union workers to their faces. They told me that’s the French way! …Sir, your letter states that you want Titan to start a discussion. How stupid do you think we are? Titan is the one with the money and the talent to produce tires. What does the crazy union have? It has the French government.
Not surprisingly, this has created a furor in France, and when I read the comments accompanying some of the articles, most of the them were in agreement that this sort of letter was exactly what one should expect from rapacious American companies.
Were Taylor’s claims valid? The evidence doesn’t bear him out. Sciences Po professor Howard Davies writes that Taylor falls far short of the mark when he accuses French workers of laziness. Davies cites a report from the UK’s Office of National Statistics to illustrate that “productivity per hour in France is about 15 per cent higher than in the UK, and almost on a par with Germany.” He also points to a UBS study from 2009 that shows that French workers are among the most productive in the world, producing $25 per hour, while Americans produce $24.10, even though Americans are working 339 more hours per year than the French (1,792 vs. France’s 1,453).
(I can’t speak for the work ethic of French tire employees, but anecdotally I can attest that the people in my office meet this description. Yes, officially they work shorter hours, but while on the job, they’re putting in the work required).
That said, there are certainly issues that are begging to be reformed. There’s a lot of suffering here from the law of unintended consequences. The best type of work contract is called a Contrat à Durée Indéterminée, or CDI, an open-ended contract in which no time limits are imposed. Once you get a CDI, it is very hard to get fired. This means that a truly incompetent person is protected from his or her incompetency. So, employers have less incentive to offer a CDI and are often wary of doing so, because they risk being saddled with a useless employee who is too difficult to get rid of.
To avoid this, employers can offer a Contrat à Durée Déterminée, or CDD, a contract that’s only valid for a certain amount of time. These contracts can be renewed, but not endlessly. It’s stressful for the employee, who has to worry whether the contract will be renewed each time its maturity rolls around. And a CDD can affect one’s personal life as well—it’s often more difficult to rent an apartment with a CDD, for example, because the landlord then doesn’t have a guarantee of continued income. Most workers with CDDs hope that they’ll eventually be turned into CDIs, but that is becoming less and less likely. In fact, the chance of moving to a CDI from a CDD fell from 45% in 1995 to only 12.8% in 2010.
Clearly, this is a problem. But I wouldn’t want to see the French system reform its way into an American one, either, with its Orwellian-named “right-to-work” states. Could the French system be improved? Without a doubt. It would absolutely benefit from making restrictions on employers less onerous. Between the French and the American system, there must be a happy medium, one that provides employers with needed flexibility while guaranteeing basic rights and protections to the workers. Maybe one of the countries will eventually evolve there. But for now, and strictly from a peon’s point of view, it is refreshing to have the state erring on my side.
Emily Seftel Copyright(c) 2013 All Rights Reserved