Insee Première · May 2021 · n° 1860

The national accounts in 2020 French GDP fell dramatically, but households’ purchasing power remained resilient

In 2020, activity showed a historic drop in France: gross domestic product (GDP) in constant euros fell by 7.9%, after +1.8% in 2019 and +1.9% in 2018. This fall is mainly a result of the health crisis linked to COVID-19: the economy has been greatly disturbed by the epidemic, while the measures aiming at limiting its spread (lockdowns, curfew, closing of retail shops, etc.), taken both in France and in various other countries, slowed also the activity down. The fall estimated this year is thus the largest in the history of French national accounts, started in 1949.

With the fall in activity in France, gross national income (GNI) lost 6.1%. General government supported almost three quarters of this fall, through policies aimed at supporting the economy (furlough scheme, solidarity funds, etc.). Despite the reduction in non-financial corporations’ income, their profit ratio remained at a level comparable with previous years. The moderate increase in households’ income (+1.0%), combined with a fall in consumption (−6.5%), led to an outstanding increase of their savings in 2020. All in all, the nation net borrowing rose by 41.2 b€.