In this crisis-busting corner of Italy\'s industrial heartland, the local college found jobs for all of its graduates last year and the latest plant to open was relocated from Germany. A short drive from the mediaeval palazzos of Florence, the town of Scandicci is booming while the rest of Italy endures a recession. Why? Handbags. Local artisans in Scandicci\'s non-descript warehouses craft luxury leather goods exported around the world by some of the biggest names in fashion. Gucci has a headquarters in Scandicci and Christian Dior and Chanel have set up plants here. The sector includes some 2,700 mostly small-scale manufacturers and employs around 20,000 people. \"Our directors are enlightened people. They asked themselves \'Where is the best place to make leather? Scandicci? Okay, let\'s move to Scandicci,\" said Giacomo Cortesi, director of a plant set up by luxury watches and accessories maker Montblanc. Montblanc\'s leather working facility opened in Scandicci last year after the company, which belongs to Swiss-based luxury holding Richemont, sold off its leather plant in Germany. \"We\'re at the heart of the leather goods business and the network is right here! You can almost visit all our suppliers by bike,\" said Cortesi. \"Basically, if you\'re buying a handbag it\'s from here.\" The facility brings together German technology and Italian craftsmanship, with an eye-opening array of machines to test the leather for every type of global climate, temperature, wear and discolouration. There is even a robotic arm which repeatedly tests the resistance of shoulder straps on Montblanc bags loaded with 15 kilos (33 pounds) of weights. The luxury company is taking its precautions against counterfeiting, which is rampant in Italy, and applies its logo only at the last stage of its own production or when it has already received the bags, wallets and belts from its suppliers. The sector in Scandicci has grown so fast in recent years that it is struggling to find enough workers, meaning that students at a local college teaching techniques for handcrafted leather work are basically guaranteed a job when they graduate. \"There is a lot of demand abroad for our leather right now. This is really a source of pride for Italy,\" said one student Francesco Gheri, who is hoping to set up his own business when he completes the course which is financed by local authorities. Another student, Claudia Paci, said her parents\' small leather business was forced to shut down because of competition from cheap Chinese goods and she was now looking at upgrading her skills for the luxury sector where the market was better. \"Luxury leather is really the way forward. This is how we can compete with China,\" said Paci, as she painstakingly cut intricate shapes with a scalpel in a roll of leather during the model-making class. The figures bear out the hyperbole -- according to the most recent data leather exports from Scandicci were up 11.3 percentage points in the second quarter of 2012 from the same period a year earlier. \"The sector is in full expansion,\" said Laura Chini, director of the Alta Scuola di Pelletteria (High School of Leather Working). \"A lot of the sector revolves around Gucci. Gucci has its roots here and everything developed in its wake,\" Chini said. Guccio Gucci founded the company in the 1920s, making high-end leather goods inspired by his years as a bellboy at the Savoy Hotel in London with a shop in Florence and production in the suburbs. The company, which has just inaugurated its new headquarters in Scandicci, is proud of its roots. \"Everything is hand made, everything is made in Italy,\" said Francesca Amfitheatrof, director of the Gucci Museum in Florence whose collection charts the evolution of the company from Florentine leather goods maker to global fashion powerhouse. Amfitheatrof said: \"Gucci is very close to its artisans. That is something that is still at the core of the brand. That\'s Tuscan pride.\"