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French unemployment holds steady: Are Macron’s labour reforms working?

France's President Emmanuel Macron waits prior to welcoming Tanzania's President Samia Suluhu Hassan as part of the "Summit on Clean Cooking in Africa" at the Elysee President
France's President Emmanuel Macron waits prior to welcoming Tanzania's President Samia Suluhu Hassan as part of the "Summit on Clean Cooking in Africa" at the Elysee President Copyright Thibault Camus/Copyright 2024 The AP. All rights reserved.
Copyright Thibault Camus/Copyright 2024 The AP. All rights reserved.
By Indrabati Lahiri
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Macron’s labour reforms have drawn criticism from all quarters, with claims that they are punitive to workers, while rewarding or cushioning companies.

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French unemployment for the first quarter of the year held steady at 7.5% , according to INSEE. This was the same figure as the last two quarters, however, was a smidge higher than analyst expectations of 7.4%.

The number of unemployed people was 2.3 million, an increase of about 6,000 from the previous quarter. On the other hand, the unemployment rate for people between the ages of 25 and 49 dropped to 6.8%, a decrease of 0.2%.

However, the unemployment rate for people between the ages of 15 to 24 rose to 18.1%, a jump of 0.6%, whereas for the over 50s, the jobless rate came in at 5.1%, inching up 0.1%.

For men, the unemployment rate was 7.7%, an increase of 0.1%, whereas for women, it fell to 7.3%, a decrease of 0.1%.

What are Macron’s labour market reforms?

These unemployment figures highlight the challenge President Macron faces to show that his controversial labour-market reforms are yielding the expected results and will be seen as a measure of the success of his presidency. The reforms aim to achieve full-employment by the end of Macron’s second office term in 2027.

Currently, the labour reforms have made it easier for companies to negotiate salaries and wages directly with employees, without the need for trade unions and collective deals impacting the whole industry.

Similarly, they have also made it easier and cheaper for companies to hire and fire workers, reducing the time to bring court proceedings regarding litigation to 12 months as well.

There is also now a limit on the damages workers are entitled to claim for unfair dismissal, which Macron believes is crucial to encourage more hiring. The new rules mandate that employees who have been working for two years at a company, before being unfairly dismissed, will now be entitled to only three months’ pay, instead of the previous six months’ pay. For workers who have been working for 30 years, the limit is now 20 months’ pay.

However, these measures have been criticised by many for being too punitive towards workers and employees, while at the same time rewarding companies with leniency.

Recently, there has also been speculation that France’s unemployment insurance could face reform, with employees having to work for longer in order to be entitled to benefits, as well as the maximum duration of welfare payments being slashed to 1 year, instead of the previous 18 months. Payments may also be gradually decreased as the months go by.

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