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Rise In French Unemployment

James Boston
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Rise In French Unemployment

The French Unemployment Rate has ticked up again according to data just released by the National Institute of Statistics and Economic Studies. The second quarter unemployment rate is now being measured as 10.2% compared to the 10.1% reading in the first quarter of this year. When France’s overseas territories are excluded from the survey the Unemployment rate remained steady at 9.7%.

The latest forecasts from the European Commission project French unemployment to average 10.4% across the whole of 2014 and to fall back to 10.2% in 2015. This is against the backdrop of two quarters without economic growth, in fact there has not been two successive quarters of growth at any point since French President Hollande took office over two years ago.

Hollande’s administration has it’s hands somewhat tied by the austerity directive from the European Union and there is much wrangling going on in French politics as the anti-austerity movement grows. Two recent cabinet reshuffles have resulted in a new economy minister who’s first act was to challenge France’s sacred 35 hour working week. Immediate pushback from the trades union movement not only caused a climb down but also underlined the improbability of any meaningful structural reforms being introduced within the struggling French economy.

The EU’s four year old austerity drive is aimed squarely at economies like France and Italy. The second and third largest economies in the Eurozone have amassed significant structural impediments to growth over the years and the viewpoint of the European Union is that the current crises is a golden opportunity to break down some of these impediments. This battle is likely to come to a head over the coming month’s as the lack of overall growth in the Eurozone significantly weakens the hand of the European Union and provides fresh impetus to the anti austerity movements.

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