Crisis-hit France strikes new record unemployment high

27th November 2014, Comments 0 comments

Unemployment in France hit a new record in October, with official statistics published Thursday showing 3.46 million people claiming jobless benefits.

The figures showed a rise of 28,400 people on the jobless queue compared to the previous month and came as President Francois Hollande marks the midway point in his troubled mandate.

The unemployment numbers were up 0.8 percent compared to September and 5.5 percent in comparison to the previous year.

"This is the biggest monthly rise since last February," said Bruno Ducoudre, an economist at the French Economic Observatory (OFCE) think-tank.

"Weak growth continues to weigh" on the unemployment figures, said Ducoudre, warning that French companies had 230,000 staff too many.

In a mid-term interview earlier this month, Hollande said he would not stand again for the French presidency in 2017 if he had not managed to live up to his promise to bring down unemployment by then.

France's economy is barely growing, showing a gain of 0.3 percent in the third quarter. The government is Paris has forecast 0.4 percent growth for the full year.

Many economists believe an average of 1.5 percent growth is needed to reduce unemployment.

Even France's own economy minister Emmanuel Macron has admitted that the economy is "sick".

"The rise in unemployment, pretty well constant since June 2008, is a sign that our economy is highly dysfunctional," said the Medef business association in a statement.

The government has introduced a much-vaunted but highly disputed "Responsibility Pact", which will cut social charges for businesses by 40 billion euros ($51 billion) in exchange for them creating 500,000 jobs by 2017.

Given the parlous state of France's budget deficit, which is expected to remain above European Union limits until 2017, Hollande plans to finance the tax breaks with 50 billion euros in public spending cuts.

This has proved highly unpopular on the left flank of Hollande's ruling Socialist Party, which sees it as a gift to business.

© 2014 AFP

0 Comments To This Article