The French people least handicapped by the economic crisis are putting money aside. Nothing abnormal so far: due to confinement, and even after, their consumption has dropped significantly. Despite a slight recovery at the end of the two months of confinement, the trend does not seem to be reversing. The very poor results of the summer sales testify to this, the French are not ready to consume as before.
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According to the French Observatory of Economic Conjunctures (OFCE), 75 billion euros should have been spent since mid-March. Philippe Crevel, director of the Cercle de l'épargne, estimates that around 100 billion euros will be saved by the end of the year. A gigantic sum which sleeps peacefully on the current accounts of the French, without moving an ear. Indeed, whether on the side of BPCE (Banque Populaire Caisse d'Epargne) or BNP Paribas, to name a few, the banks are observing the use of current accounts on the rise over one year. + 28% at BPCE, + 27% at BNP. The use of the Livret A, even at a low rate of remuneration, is also important. Over one year, it has almost doubled, passing, over the first six months of the year, from 11.57 billion euros in 2019 to 20.41 billion this year.
The French are born savers
The phenomenon is not entirely new. " It's a fundamental trend ", adjusts Philippe Crevel. He recalls that " the savings rate has been climbing for several years " and specifies that even before the crisis, this rate was around 13%, and now easily exceeds 20%. “ We were already in a strong trend, with stagnation in consumption, prudence and therefore the maintenance of a high savings rate. So when you add a historical event to that, it pushes even more towards savings, ”he analyzes.
They never go back to their previous savings level
All this has therefore necessarily been accentuated by the current economic crisis. " We note that since the beginning of the 2000s, with each crisis, the French always keep a little more cash and we never return to the initial level ," continues Philippe Crevel. Thus, even in the event of a return to growth, the French prefer to keep a small mattress in their bank account. “ There is a real aversion to risk. We fear the next crisis, so we put money aside, ”adds the economist. And even if it pays little. Because it is the search for security that counts above all.
For the rest, “ everything will depend on the health and economic context. If the unemployment rate continues to rise sharply, if there is a second wave of the epidemic, then it will absolutely not be favorable to consumption, ”anticipates Philippe Crevel.
The uncertain climate pushes the French to keep their money
What will happen in the next few months? Resumption of activity, reconfinement, repeated bankruptcies? This absolutely uncertain situation also pushes the French to keep their savings. " They did not draw on the savings constrained by confinement and now, they keep it to make a precautionary savings ", notes Philippe Crevel. “ Economics is psychology, ” he explains. “ So when we say that September is going to be terrible, we have to admit that it does not make you want to take risks. Or you have to have a strong heart to try long expenses , ”he adds.
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According to him, the government will therefore try to play on confidence from the end of August. " This is where the stimulus plan could play a role in encouraging the French to consume, " he predicts. By then, it is too early to predict whether or not consumption will take off again in September, adds the economist.
Low rates put money to sleep
The massive use of current accounts is part of another well-established trend in recent years: low rates. “ There aren't many investments that are considered attractive, so what's the point? »Translated Philippe Crevel. According to him, the interpretation is simple: “ I let the money sleep because I don't lose much by not investing it ”. Added to this is the uncertainty of the financial markets, which further prevents risk taking and investment on the stock market.
More and more precarious, the French protect themselves
Crises have been linked for several years: 2008, the debt crisis then, more recently, the “ yellow vests ”, even the pension reform that Philippe Crevel considers “ very anxiety-provoking ”, and finally the health crisis of the coronavirus. “ There is this anxiety and this succession of crises which leads to the rise of fixed-term contracts or temporary work, ” continues the expert from the Cercle de l'épargne. All this pushes a large number of French people to a feeling of precariousness, " whether real or felt ". " And when we chain precarious contracts or fear to chain them, we need a small mattress to do the welding, " he deciphers.
According to him, a final structural factor will boost French savings in the months to come: the aging of the population. “ The older you are, the more you keep your money, ” he concludes.
