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Europe

French govt criticised for ‘weak’ job-creation schemes

Text by FRANCE 24

Latest update : 2012-09-05

The French government has announced plans to subsidize job opportunities for young people in deprived areas. But some are not convinced the measures are bold enough as the number of unemployed people in the country passes 3 million.

As unemployment in France officially passed the three million mark, the government has come under intense criticism for schemes to subsidise new jobs for young unemployed people.

One of the Socialist government’s plans, announced last week, involves subsidising the creation of 150,000 mostly public-sector jobs between now and 2014 under an “employment for the future scheme” that focuses on young French jobseekers from deprived areas.

The government wants to follow this up with a further 500,000 “generational jobs” which would allow private-sector companies to take on little-qualified young employees. The state would sponsor these positions by reducing employment charges, allowing companies to retain older workers who would stay on as “mentors”.

But following Labour Minister Michel Sapin's admission on September 2 that some 3.23 million were now unemployed in France and its overseas territories, both schemes came under criticism from the left, with left-leaning daily Liberation accusing the government of lacking ambition.

Meanwhile, Valérie Pecresse, who was labour minister in former President Nicolas Sarkozy’s conservative government, said on Tuesday that the “employment for the future” scheme “was neither real employment, nor a real future.”

Jobs abroad

Economist Mathieu Plane told FRANCE 24 he supported the plans as a good idea in a time of crisis, adding that the critics were missing the point.

“Of course, creating these jobs isn’t going to reverse unemployment,” he said. “But we need to know what we are talking about here – these subsidised work contracts are about minimising the social ramifications of the deteriorating economic situation that exists throughout Europe.”

Growth, rather than direct government intervention, is the only real factor that will reduce unemployment, he said, adding that the probelem, being Europe-wide, would not be solved by France alone. 

Plane also admitted that most of the jobs created would last only as long as the state continued to subsidise them, and “only 50,000 to 100,000” would end up being long-term positions.

For many French businesses, the fundamental long-term solution to reduce unemployment is to relax the high employment taxes and social security contributions companies are obliged to pay when they hire staff, and thus reduce the cost of labour.

Yves Bontaz, who employs 350 people in auto-parts factories in France, told FRANCE 24 on Wednesday that a factory he had planned to open in the Haute-Savoie administrative region in eastern France would now be built in Morocco instead, where labour is considerably cheaper.

Insisting that the decision was not politically-motivated, the outright supporter of the right-wing opposition UMP accused France’s socialist leaders of being “fundamentally anti-business” and of driving the economy “into a hole”.

“Employee tax in France is just too high,” he said, explaining that the high cost of hiring staff meant that he had no choice but to set up his new factory, which will employ 400 workers, in a cheaper environment.

“Liberalise the work market and you will create more jobs,” said Bontaz. “As for the government subsidising new jobs, this is a weak measure – it’s the French taxpayer who will end up footing the bill for schemes that the state can’t afford anyway.”

 

Date created : 2012-09-04

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