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Unemployment rate in France climbs for 19th month in row

December 28, 2012|By Kim Willsher
  • French President Francois Hollande speaks to journalists as he visits a wholesale market in Rungis near Paris on Thursday.
French President Francois Hollande speaks to journalists as he visits… (Benoit Tessier / Agence…)

PARIS — The number of jobless in France has risen for the 19th consecutive month to hit 3.13 million, a near 15-year high.

Government figures show unemployment rose by more than 29,300 in November, taking the total to about 10.7% of the working population. The data released Thursday were among several reports in the last week that cast a pall on France’s economic outlook.

President François Hollande admitted Thursday that his biggest challenge in 2013 will be getting the country back to work. However, his Socialist Party government blamed the previous center-right administration, thrown out of power in May, for the increase.

“These figures are a severe reminder of those who let our country decline for five years. It calls for an unprecedented mobilization by everyone to combat it,” party chief Harlem Desir said in a statement.

Hollande predicted there was worse to come and admitted unemployment would be the “great battle for 2013,” but vowed to reverse the trend by the end of next year.

“During this holiday period I have to say to the French that we have to all take to the bridge to work and fight against unemployment,” he said during a surprise visit to a wholesale food market in Rungis outside Paris.

Hollande faces a challenge to get unions and employers to agree to changes in labor laws aimed at creating flexibility and boosting competitiveness after talks between bosses and union leaders reached a deadlock by the December deadline.

Labor Minister Michel Sapin called on the parties to reach an agreement when negotiations resume Jan. 10.

The jobless figures came after the national statistics agency INSEE predicted that Europe's second-largest economy would grow just 0.1% in the first and second quarters of next year, less than previously estimated. This threatens the government's pledge to rein in the public deficit and could spark further job losses. INSEE predicted that unemployment was likely to continue rising at least until mid-2013 to 10.9%.

An annual report by a leading British economic think tank, the London-based Center for Economics and Business Research, suggested France would fall behind Britain in terms of gross domestic product next year. The report put France in sixth place with Britain replacing it at fifth. The United States, China, Japan and India filled the first four places in that order.

The report blamed France's flagging rating on “the economic effects of President Hollande's 75% tax policy and the difficulties of the euro.” Hollande has promised to introduce in January a 75% “supertax” rate for income over $1.32 million a year.

Another blow came as a survey of U.S. businesses by the American Chamber of Commerce in Paris revealed that only 22% of the heads of American companies in France view the country as an attractive place to do business. This was down from 56% in 2011.

Just over half of those quizzed said the financial outlook in their sector had deteriorated. The chief reason given for the bleak view of France was Hollande's victory over the conservative Nicolas Sarkozy in May.

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