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French unemployment near 13 year high

French unemployment near 13 year high
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The number of people out of work in France rose for the 14th month in a row in June.

There was an increase of 0.8 percent from the previous month and the total was up 7.8 percent from June 2011. That puts it at the highest level in nearly 13 years.

Things can only get worse with Air France, Peugeot Citroen and drugmaker Sanofi planning layoffs.

Alcatel-Lucent joined the list on Thursday, saying it will cut 5,000 of its employees worldwide.

The French-US telecommunications equipment maker – which is suffering from weak demand – did not say which countries would be hit. It has just under 8,500 workers in France and 76,000 worldwide.

Government under pressure

The job cuts add pressure on France’s new Socialist government, which has made job a top priority.

President Francois Hollande rode to power in a presidential election in May vowing to tackle surging unemployment, but is struggling to halt waves of layoffs with the economy under threat of slipping into recession.

His government is battling to reduce the impact of 8,000 job cuts by French carmaker PSA Peugeot Citroen. On Wednesday it presented a modest aid plan for the flagging car industry.

Hollande pledged during the election campaign to create 80,000 subsidised jobs and hire 60,000 people in the education sector as well as create a so-called “generation contract” to encourage companies to hire young workers.

The labour ministry also said that discussions about schemes for reduced working time would be held with unions and employers during the second half of the year with the aim to reach an agreement in January.