Full employment remains a priority for France. While a lot of reform has been carried out in this direction, the challenge is still considerable, explains Stéphane Carcillo. See you at the Economic Meetings on July 5-6 to discuss it.
For several years, France has been engaged in ambitious reforms to try to put an end to mass unemployment. The strong momentum in job creation in recent years is an encouraging sign. But with an unemployment rate at the bottom of 7%, our country is still looking gloomy compared to most European countries which are sailing between 3 and 5%. We will need to create nearly one million additional jobs to bring the unemployment rate down to 5% and reach an employment rate of 70%.
It is worth recalling the extent to which it is still necessary to achieve full employment. By reducing social spending while improving tax revenues, job creation strengthens our ability to invest in the health system, basic research, education, and the ecological transition, all of which require considerable efforts in the coming years.
Promoting employment
The financial determinants of employment have been strongly reoriented over the last 15 years. On the corporate side, reductions in social security contributions have been massive, while the contractual termination and the clarification of the conditions of dismissal have secured the end of contracts. On the workers’ side, the successive pension reforms, the creation of the RSA and the activity bonus, as well as the reform of unemployment insurance have clearly strengthened the incentives to take a job and keep it, especially since the labour market remains very tight.
But the level of employment also depends on non-financial factors that shape the ability to find a skilled workforce, and it is probably this dimension that now deserves the most attention. Admittedly, the lifting of unnecessary constraints has allowed an unprecedented boom in apprenticeships, with the key to a faster integration of young people into employment. But many people do not yet have access to it, and the essential transformation of vocational schools has only just begun. The creation of the personal training account has been a great success with adults, but it is still very difficult for the least qualified people to find their way through the training thicket.
Remaining obstacles to full employment
Lack of time, lack of information, lack of means of transport or lack of childcare solutions are all obstacles to employment that are also in the sights of France Travail, newly created. This overhaul of the public employment service, which aims to get services that today too often operate in silos work together at the local level, is to be followed closely because the devil is in the details.
More broadly, housing and geographical mobility at the national level are major obstacles. The high cost of housing in economically dynamic areas limits the ability to reallocate jobs. These reallocations are essential to the growth of start-ups that drive innovation and job creation. Workforce thresholds that are too low for the triggering of social obligations, or collective standards too often designed by and for large companies, still weigh too often on hiring in these companies.
There are still many areas to invest in order to achieve full employment. These themes will be the subject of a debate at the next Economic Meetings in Aix-en-Provence, from 5 to 7 July. There is no doubt that the new electoral context will nourish reflections on this central theme for our future.
