Tags: EU | France | Unemployment

French Unemployment Rate Jumps to 10 Percent

Thursday, 04 Mar 2010 10:43 AM

 

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France's fourth-quarter unemployment rate jumped to the highest level in a decade — 10 percent — an eye-catching figure that is likely to weigh on voters ahead of regional elections.

Joblessness rates have been climbing for seven quarters, since the economy dipped into recession in 2008, but the leap announced Thursday by national statistics agency Insee was especially high, from 9.5 percent in the third quarter.

The last time unemployment was at 10 percent was in 1999, Insee said.

The announcement was an embarrassing setback for conservative President Nicolas Sarkozy, who pledged in a widely watched television interview in late January that joblessness would drop in the coming months.

"Where is the drop in unemployment promised by Nicolas Sarkozy?" the opposition Socialist Party asked in a statement, saying France should have plans to stimulate consumer spending and investment, and also boost efforts to help the unemployed.

Jobs are a main topic of concern in regional elections scheduled for March 14 and 21. Sarkozy came to power in 2007 on a pledge to get France working more, but he ran into trouble pushing through many planned labor reforms even before the economic crisis hit.

Finance Minister Christine Lagarde and the junior minister for employment, Laurent Wauquiez, tried to put a positive spin on the joblessness figures, saying the job market in France has resisted the crisis better than many countries.

France's number of unemployed is 22 percent above its level in May 2007 — when Sarkozy was elected — while joblessness across the 16-country eurozone rose 34 percent in the same period and the United States' rose 119 percent, they said in a statement.

Marc Touati, an economist at Paris-based brokerage Global Equities, said the unemployment rate could not be blamed on the crisis alone. He cited structural problems in the French labor market, saying education and youth training programs are poorly adapted to employers' needs.

Prospects are worst for French youths under age 25: nearly a quarter of them are unemployed.

Touati predicted that unemployment will likely "stay around 10 percent throughout 2010, even if a small drop should nonetheless happen before the end of the year."

Excluding French overseas territories and provinces, where joblessness is higher, the unemployment figure was at 9.6 percent.

When France's quarterly unemployment rate was last at 10 percent in 1999, the labor market had a much different look: The Socialist-led government was pushing through a reform to shorten the workweek to 35 hours, on the rationale that employers would be forced to hire more people.

Ensuing conservative governments have deemed the shorter workweek a mistake, and parliament has substantially chipped away at the law that put it in place, encouraging people to work more.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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