Measures fail to stem soaring unemployment

A total of 2,987,100 French people were out of work at the end of July, according to new figures, a record level not equalled since January 1999. The number of jobseekers had increased in July by 41,000, the highest level in three years. “So soon after the handover of power [following elections at the beginning of the summer], the new administration is not solely to blame. [...] However, the fact that it still benefits from a presumption of innocence does not in anyway excuse it from the obligation to take urgent action,” warns Les Echosin an editorial.

The daily is alsocritical of two measures recently announced by the government which it argues will have no positive impact on the labour market —

Far from creating work for the unemployed, the taxation of overtime is a counterproductive measure that will undermine business and have a negative impact on jobs. Contrary to the entrenched theory of work-sharing, overtime worked by some members of the workforce results in the recruitment of others. The other measure, which is as expensive as it is futile, is the decision to create 150,000 subsidised jobs that in most cases will turn out to be temporary contracts with no enduring impact.

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Les Echos calls on the head of state to implement structural reforms to make the labour market more flexible, which is the sole means of generating growth. As Le Monde reports, in a television interview, Prime Minister Jean-Marc Ayrault has acknowledged that France’s growth forecasts may have to be reviewed —

The government may have to “adjust down” the growth forecast for 2013, currently set at 1.2 per cent but deemed to be too optimistic by economists. [...] The International Monetary Fund is predicting that the French economy will grow by just 0.8 per cent in 2013, while the average forecast by economists stands at just 0.5 per cent.