Partie II. La croissance manque d’énergie. Perspectives 2022-2023 pour l’économie française

Eric Heyer and Xavier Timbeau

Revue de l'OFCE, 2022, vol. N° 178, issue 3, 131-163

Abstract: The French economy is experiencing multiple shocks (rising energy prices, geopolitical uncertainties and tensions, waves of the Omicron variant and supply difficulties, rising interest rates, etc.), leading to a decline in growth despite the fiscal measures taken. While GDP grew by 6.8% in 2021, which partially offset the fall in 2020 (-7.9%), it will increase by only 2.6% in 2022 and 0.6% in 2023. This forecast does not take into account any effect linked to energy disruptions or rationing. The ?energy shock? alone, comparable to the first oil shock for the French economy, would reduce GDP by 3.3 points, but the fiscal measures taken to respond to this should cushion the shock by 1.5 points in 2023, at a gross cost to the budget of 47 billion euros (18 billion net). With oil at 100 dollars a barrel in 2023 and a 15% hike in regulated gas and electricity tariffs, energy prices should rise by 22% in 2022 and by almost 10% in 2023. The nominal basic monthly wage (salaire mensuel de base ? SMB) should rise in nominal terms by 3.4% in 2022 and 3.8% in 2023. In total, CPI inflation will pick up by an average of 5.1% in 2022 and 4.6% in 2023. Household income will go up sharply in the second half of 2022 due to these strong revaluations in the summer, largely offsetting the sharp losses in the first half year. In 2023, the expected adjustments in the labour market will weigh on wage hikes, and real GDI is expected to fall by -0.3% in 2023. Over two years, despite the fiscal measures and the revaluation of the minimum wage (SMIC), purchasing power per consumption unit should shrink by 1.4%, bringing it down to a level close to 2019. The savings rate should rise from the current 15.5% to 17.4% at end 2022 due to the inertia of consumption and the level of uncertainty, which will remain high at year end. The savings rate should fall back to a level close to its pre-crisis state by the end of 2023, at which point the "over-savings" accumulated since 2020 should reach 11.7% of GDI. After the creation of 240,000 jobs in 2022, weak growth in 2023 and the gradual adjustment of overstaffing, estimated at more than 500,000 jobs in mid-2022, should result in job losses (-175,000). In this context, the unemployment rate, after having fallen to a low of 7.2% in the third quarter of 2022, should rise to 8% by the end of 2023. This scenario assumes that the stock of apprentices will remain relatively stable over the next few quarters at around 900,000. Over the 2020-2023 period as a whole, the exceptional measures taken by the government to deal with the Covid crisis and then the energy crisis will represent a one-off cost for the public purse of 270 billion euros, or 10.8% of GDP over four years. The public deficit, which fell from 8.9 GDP points in 2020 to 6.4 points in 2021, should continue to narrow despite the new measures taken on energy, to 4.9 GDP points in 2022, due to the gradual fading out of the emergency measures linked to the Covid crisis and the high tax yield from compulsory levies. In 2023, the deficit should be slightly over 5.2% of GDP, as a result of the slowdown in growth and the expected lower intake from tax revenues, the rise in interest charges and the structural decline in compulsory levies. The public debt, in the Maastricht sense, fell slightly in 2022 to 111.2% of GDP (compared to 112.5% in 2021), but should rise again in 2023 to 112.2% of GDP.

Keywords: Economic outlook; French economy (search for similar items in EconPapers)
Date: 2022
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