Support for unemployed individuals should be reformed to reduce the government deficit, according to France's new PM.
ADVERTISEMENTThe French government wants to boost workforce numbers by changing the way it financially supports unemployed individuals.
This initiative, spearheaded by Prime Minister Gabriel Attal, comes after France gave a downbeat economic update last week.
In 2023, France's budget deficit widened to 5.5%, significantly overshooting the state's target of 4.9%.
Responding to the data, the government claimed it will not increase taxes, but it is instead looking for other means to plug the gap between spending and income.
One of the hallmark's of President Emmanuel Macron's tenure has been a focus on levelling up France's labour force.
Since he came to power in 2017, Macron has made a number of changes to the country's unemployment system and the amount of people out of work has dropped drastically.
In light of the new budgetary challenge, another similar shake up may be on the cards.
According to Gabriel Attal, who works under President Macron, the length of benefit payments given to individuals in France may be reduced to no less than 12 months.
In line with current rules, those aged 53 or under can receive up to 18 months of financial support, plus an extra six months if jobs are scarce.
For those over this threshold, the payments are more generous, although it's not yet clear whether the age-weighting will change.
As part of a new reform package, Attal has also suggested modifying the eligibility criteria surrounding unemployment benefits.
Currently, individuals must have worked for six months out of the previous two years to qualify for support. This six-month threshold could be raised, or the two-year period could be shortened.
The final option proposed by the French government is to lower the amount of money paid out to claimants.
Attal has expressed hesitancy over this approach, telling French broadcaster TF1: "This is one of the avenues [we could take], although I prefer it less than the previous two."
When it comes to specifics, the French Prime Minister has passed the baton to employers' federations and unions.
Proposals from these groups are expected in the coming months, so that concrete plans can be enacted in the autumn.
The French government argues that its current support system for unemployed individuals is more generous than its European counterparts.
For those in France, the unemployment support covers 57% of previous earnings, up to a monthly maximum of €8,359.
ADVERTISEMENTIn Germany, this ceiling can go up to €7,550 in certain regions, and in Italy, the maximum monthly allowance is around €1,550.
According to the unemployment insurance fund UNEDIC, the duration of payouts in France is also roughly in line with other European nations, such as Italy, the Netherlands and Spain.
