- Your history
-
Stories
- Exportspecialisatie
- Europese banken blijven ondergekapitaliseerd
- European Commission Forecasts
- EU Klimaatsteun
- Econopolis debate on the crisis
- Correction of Greenspan exuberance period
- Electric cars - the chicken or the egg?
- Einde van de belastingparadijzen?
- Een 'Sustainable New Deal voor Vlaanderen'
- Een muzikale koppensneller
- Eén jaar na Econoshock...
- Een crisis van de normen en waarden
- Econoshock heeft ex-premier Dehaene lichter gemaakt...
- Econoshock #2
- Econochocs!
- Duurzaamheidsfonds
- Duurzaamheid en Econoshock samen in het FD
- Durven inzetten op innovatie
- Dubbelzinnig over energie en de beurs
- Duale maatschappij en Wallonisering
- Deze avond debat met Paul Krugman - update over de bubble
- Deflation does what it does best: removing excesses
- De wereldeconomie maakt een harde landing
- De VS: militaire macht volgt economische macht
- De vrouwen helpen ons door de crisis
- De vakbond gaat op reis
- De sterkste schouders kreunen
- De ruimtelijke wanorde vanuit de ruimte
Foreign companies increase labour productivity
An interesting piece ofanalysis by the CBS(Dutch Statistics Office) on labour productivity. They have analysed labour productivity of foreign-owned companies. And, it appears that productivity rates are much higher in foreign-owned companies than domestic ones. Top rated are US and UK foreign owned companies, with the Japanese coming third. Companies from Core European owners have bottom rankings...
The study says that :
The main reason for the differences in labour productivity is that foreign companies tend to concentrate their staff and researchers in their main office. As a consequence, companies under foreign control appear to generate more output.
This has important consequences for economic policy:
-
the attractiveness for foreign investments is crucial for labour productivity of the economy
-
foreign companies bring in know how and processes that increase productivity, with spill-over effects on local companies and sectors
-
it supports my thesis that losing some world-class sectors like chemicals, automotive and energy, catapults a country from Champions' League into second or third division
Note also that the productivity of Belgium-owned companies in the Netherlands is much lower than the average. This is due to an important degree to a sector effect, but also indicates that we have much to win from foreign-owned companies.
13 Comments
-
Jan P
On 24 Nov, 2009
Dus het drama is dus niet enkel dat we ogenblikkelijk jobs verliezen bij vertrek van Renault, Opel, DHL, ...
Het drama op termijn is dat ook de eigen bedrijven slechter gaan doen wegens gebrek aan kruisbestuiving...
Misschien nog extra opslag geven aan ambtenaren en extra belasting op bedrijfswagens heffen dan? En waarom niet meteen de notionele aftrek afschaffen? Of misschien kunnen we de bureaucratie nog verhogen; dat is ook altijd goed voor de werkgelegenheid op heel korte termijn... -
Herman
On 24 Nov, 2009
Dit land heeft een serieuse reset nodig.
Als je ziet dat 43% van de werkende bevolking in Wallonie voor de overheid werkt (+ de werklozen).
En als je ervan kan uitgaan dat het in Vlaanderen niet veel beter zal zijn.
Dan zie je meteen wat het probleem is, we kunnen ons wel vrolijk maken dat de crisis hier niet zo hard heeft toegeslagen als in de andere landen, maar op moment dat de groei er terug is zullen wij er ook niet van profiteren.
Ondertussen zinken we verder en verder.... , de politici durven er al lang niks meer aan doen -
carl
On 24 Nov, 2009
nder probleem: hoe kan een medewerker nog zijn materiele welvaart nog verbeteren alds hij zoals in frankrijk verplicht wordt om maar 35 uur per week te werken?Hoe ontsnappen aan deze rigide wettelijke verplichting?Dit is onmogelijk,tenzij hujzelf ondernemer wordt.
En dus tot die groep van dertig procent wil behoren.
Productiviteit in de tertiaire sector.Er werken in de financiele en verzekeringssectot in US ongeveer 6,6 miljoen mensen.Er zijn er al in één jaar elf ^rocent of zevenhonder duizend naar huis gestuurd.Betekent dit een verhoging van de productiviteit in de sector?
In 2007 waren er 126 miljard Europese uitgaven.Daarvan was er slechts zeven procent bestemd voor het verbeteren van de concurrentiekracht.
55 procent ging naar de subsidies vaar de boern en de plattelandswerking.
Gaan we daarmee een werledkenniseconomische supermacht worden die een hoge graad van productiviteit realizeert? -
carl
On 24 Nov, 2009
Zolang er geen ernstige verlaging komt van de lasten op arbeid zitten we in een vicieuze cirkel.
We zijn als ondernemers verplicht om te automatizeren,te robotizeren,te outsourcen omdat deze lasten superzwaar zijn om te verrekenein je eindprijs.
Gevolg daar van is : nog meer werklozen.Onze beleidsmakers vinden wel een oplossing hiervan,nl nog meer gesunsidieerde jobcreatie in allerlei statuten via OCMW,via sociale economoe,PWA enz.
Gevolg ;nog meer creativiteit in het heffen van steeds maar nieuwe belastingen,waardoor we verder verplicht zijn om de productiviteit nog meer op te drijven.
Terwijl dertig procent van de bevolking nu al tachtig procent van alle belastingen betaalt. -
Jan L
On 24 Nov, 2009
Foreign investments are good for jobs, knowledge sharing,... I agree.
On the productivity side on the other hand:
Foreign investments make our economy more productive, because non-productive jobs stay in the home country.
Take two companies that have exact the same business, same (worldwide) costs, same (worldwide) revenues,... And let's assume there is a country that has the same taxes, wages,... as Belgium. Now would you choose this company to be Belgian or foreign? The only difference would be, that if it's Belgian, we get something extra: (non-productive) jobs.
Belgian productivity in companies is rather high, but minimum wages are high also. Our productivity is high because we keep low-productive people out of the labour market. Is this a good thing?
We need to see beyond productivity. Don't get me wrong, foreign investment is good, but if we manage to get the same production AND extra support jobs in a domestic company, it's even better. -
Tyr
On 24 Nov, 2009
I completely disagree. Firstly I think you overestimate the know-how foreign companies bring in (it doesn't help that with the exception of chemical you list some of the least innovative sectors in the world today.) The whole point of keeping R&D in the home country is to keep the knowledge and, more importantly these days, all the patents there insuring its dominance on the market. The only countries where I see a true knowledge transfer going on today are those new economies who have at best a cavalier attitude towards patents and at worst a complete disregard for them. It would be more beneficial to our economy to stimulate home grown innovation (even at the detriment of productivity.)
Second are the scale effects referred to in the summary. It stands to reason a Belgian company operating in the Netherlands, which probably only has a presence in the Benelux, has a lower productivity than a US-based multinational through economy of scale alone. For this reason the results look skewed to me, maybe they should be weighted by average company size.
Finally, there has been too much focus on productivity in the past. We've arrived at a point where increasing labour productivity, in practice doing more with less people, is hollowing out the economy. We are sawing off the branch we're sitting on by focusing on productivity because of a search for ever increasing profits even while counting on consumer spending to keep our economy running. The solution of course is to make sure benefits of increased productivity are passed on to consumers/workers but unfortunately no one since Ford seems to have been able to grasp this simple fact preferring trickle-down magic thinking instead. -
Nick Doms
On 24 Nov, 2009
I agree that we cannot simply compare local companies with foreign owned companies based on productivity alone.
It may be an indicator but it has to fall within a wider range of judgment.
If we were to include laborcost, both actual and deferred, would we then come to the same conclusion?
maybe Geert can answer that question and whther those integrated statistical are available.
Sincerely, -
Theo
On 24 Nov, 2009
I've aid this all along... we can learn a lot from others!
GM learned how to turn around from their experience in China.
Similarly, former Vodafone CEO acknowledged how much they have learned from people in India.
Currently on holiday in Spain... After 20 years of coming to Spain, it's unbelievable how much Spain in ahead of Belgium today! in spite of the crisis and the high unemployment! Why is that? Because of the mix and mingle of people here!!!
I've seen the same in Australia too. They know it, and it's why they organise themselves accordingly. They value foreigners. -
(n)iemand
On 24 Nov, 2009
Hier kan je zoveel redenen bij bedenken:
1) Je gaat pas in het buitenland investeren als je zeker bent dat de kool het sop waard is.
2) Als je moet snijden, zal je eerst kijken naar de laagste productiviteitscijfers en vervolgens in die groep eerst in het buitenland snijden. Als je personeel dat beseft ,gaan ze daarenboven nog eens harder wroeten want "den amerikaander" moet zijn zak geld hebben.
3) Meer beursgenoteerde bedrijven onder multinationals die hun personeel driemaandelijks gek maken en opjagen.
etc. -
Nic
On 24 Nov, 2009
Ik ben er in geïnteresseerd om hiervan de breakdown per sector te zien.
Men zou verwachten dat sectoren die van nature een lagere relatieve arbeidskost hebben, hierdoor relatief ook minder geïmpacteerd zijn. In dat geval is er nog hoop voor vlaanderen als we erin slagen om klassieke productie te vervangen door bedrijvigheid die meer door technologie gedreven is...
Om het met de uitspraak van een gevierd (buitenlands) trainer te zeggen: Elk nadeel heb z'n voordeel. Je moet het natuurlijk alleen weten te herkennen en benutten. -
Nick Doms
On 24 Nov, 2009
Here is a brief example even though it is US based.
Nissan, Honda and Toyota have large production facilities in Alabama, Mississippi and Kentucky.
GM, Ford and Chrysler have their production facilities in the North.
By comparison, their productivity levels are similar and any small variant is negligible.
However, when you compare the cost structure, then things come to light.
When the Japanese produce a car, the factory makes 1,500$ in net profit.
When an American company rolls out a car, they lose 4,000$.
Why?
The answer is not productivity but the production cost:
-Direct cost: labor and salaries
-Deferred cost: health care and deferred pension plan benefits.
So i would like to see an integrated statistic to determine not just productivity but overall competitiveness versus locally owned companies and such would paint a broader and more accurate picture.
Sincerely,
@ Theo
Enjoy your vacation. I love Spain and spend time in Montroigh del Mar when i can. -
Theo
On 25 Nov, 2009
@ Nick
Thank you!
Been talking to a bunch of people here on holiday from all over the world... when the Rioja starts flowing at 2-4-1 rate, everybody loosens up.
Given the recent blog entries I chatted with a Dutch guy living and working here for the past 7 years with his family.
So he is Dutch, living in Spain and working for an American company with global presence.
There are some 20 nationalities working together in the company in Spain and, although they get instructions from their American HQ, the HQ itself is composed of some 20+ nationalities as well.
What's most interesting about this company is that's a leader in its field both in terms of products and services and innovation in its home market, a concept it started exporting to other geographies some 10 years ago... Europe has been a relative success.
The problem for them occurred when they tried to expand into Asia in this particular segment... at first they couldn't understand why the Asians were not as blown away by their offerings as it was the case in the US and Europe!
Then they decided to spend 2 years studying the issue.
To cut a long story short... at the end of it they redesigned they entire product and introduced a totally new way of doing business, which they learned from studying the Asian market and consumers. This gives them the opportunity to do twice the amount of business with the same capacity and assets and give more choice, flexibility and satisfaction to their customers.
I also asked the Dutch guy what he thought about the kilometerheffing to be introduced in Holland.
He says that he doesn't care as he would never go back to live in Holland.
But as far as Spain goes... we talked about the fact that there seem to be no traffic jams in this part of the woods! which is even more surprising given the fact that it's one of the most densely populated and built up areas of Spain. He tells me that during the peak summer months some 8 m people decent upon the Costa del Sol.
How they do it? With brains!
Which is a surprise given the fact there are books in the shops about the building Mafia ...
But it's true!
20 years ago built up here was 1/10 of what it is today and the roads were really bad.
Today the contrast with driving in Begium is mind boggling. The evolution of that is definitely something to ponder over..
Oh yes, fuel is 40-50% cheaper and everybody drives just as much or even more than in Belgium.
So how do they manage to achieve this without too much state intervention (beyond the zoning and the building of the roads) and we seem to be needing a nanny state interventionism in every aspect of our lives?
