France shrugs as the government promises jobs

Christopher Werth Aug 21, 2013

France shrugs as the government promises jobs

Christopher Werth Aug 21, 2013

It’s a summer evening in the town of Trappes just outside central Paris. Kids play in the park, old men talk at the corner, and out on the street, Kader Mohammed turns up the stereo in his car, and starts to rap about life in the neighborhood. He talks about drugs, violence and how Trappes is nothing like the elegant boulevards of Paris.

Unemployment in France is at roughly 11 percent, but it’s even higher here in the poorer “banlieues,” or suburbs that surround the French capital. And if you’re in your twenties, like Mohammed, your chances of finding a job are even worse. Youth unemployment is at a daunting 26 percent.

Mohammed says he lost his job on a Peugeot assembly line six months ago. And he’s angry French president, François Hollande, hasn’t done enough to solve the problem.

“It’s very difficult to find work in France because of the crisis,” says Mohammed. “We hear President Hollande talk about jobs, but we see nothing. There’s no work.”

The lack of jobs has helped make Hollande one of the most unpopular French presidents on record, and in response, he’s made what may be a very difficult promise to keep.

“Here’s a commitment to sustainably reverse the unemployment rate by the end of the year,” said Hollande in a speech earlier this summer.

Ask many economists about how to do that, and they’ll tell you the best way to get companies to hire more workers in France is to make it easier to fire them. Dominic Barbet of the French bank, BNP Paribas, says French employers are too restricted from laying off workers when business is down.

“Employers hesitate before hiring people because they know that reducing staff takes a long period of time, and requires compensation to employees, which could be quite significant,” says Barbet.

France has made some changes to strict labor laws, but to meet his pledge, Hollande is now embarking on a hiring spree. The government plans to create more than 500,000 short-term contracts this year — largely in the public sector — and it’ll pick up the tab for 75 percent of the cost of hiring them. Many are reserved for youth from low-income areas.

Virginie Gorson-Tanguy of France’s National Movement of the Unemployed says it’s a solution that might put money in peoples’ pockets now.

“But it’s not a long-term solution,” says Gorson-Tanguy, “because after this contract there is no job for them.”

She says the French government is merely tinkering with the unemployment figures. Instead, advocates like her want to reduce France’s already low 35-hour work week to 32 hours, which she says would ideally force businesses to hire more workers.

“It might seem very strange for an American to hear that,” says Gorson-Tanguy. “But there is no jobs for everybody, so we need to share work.”

And it’s not just young workers that feel hopeless in France. Fifty nine-year-old Catherine Barocco has spent decades in the corporate tourism industry, but says she’s gone seven months without work.

“After 50 years old, if you lost your job, you’ll never find another one,” says Barocco. “I’m so disappointed because France is a very, very rich country. And I think the economy was really good years ago, and we just wasted, waste everything.”

She has no hope that Hollande can keep his promise. In fact, the International Monetary Fund expects the country’s jobless rate to rise to 11.6 percent by next year.

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