The third stage in the fight for employment begins
Dominique de Villepin chaired a government seminar in Troyes, on 31 August, holding his 14th monthly press conference there and officially launching the third stage in the nation’s Employment Plan.
In his address, the Prime Minister made a point of stressing the latest figures posted by the French economy: overall growth assessed at 2%, and a decline in the ranks of France’s unemployed (-310 000 since June 2005), with the unemployment rate slipping back below the 9% mark.
The measures unveiled at the conference “are all designed to bring back to the workplace those currently farthest from it”, whether unqualified young people, young graduates from at-risk urban areas or the long-term unemployed. The measures form the third stage in the Employment Plan launched by the government earlier.
As such, in light of the “special constraints” to which smaller companies are subjected, the Government intends to “move toward eliminating all employer taxes on minimum-wage workers in companies with fewer than 20 employees”. The measure, deemed “useful to employment” by Dominique de Villepin, will be the focus of dialogue between the French Parliament and the industrial partners.
By way of the “SME Growth” plan, an additional effort will be made in September 2006 to help companies with 20 to 500 employees, which have been deemed too few in number across the country. The plan will institute so-called “growth” status for companies, allowing those eligible to bypass certain administrative procedures. Lastly, funding for SME development will be made less risky.
New Measures for Unemployment
Out of the measures introduced, Jean-Louis Borloo chose to focus on five lines:
Job creation by jobseekers needs to be encouraged. To back his view, the Minister of Employment cited the figures released by the Guidance Council on Employment, which has stated that doing away with reduced-rate employer taxes would cause 800 000 jobs to be destroyed. Using lower employer taxes as a lever and offering easier access to grants, Jean-Louis Borloo anticipates that the unemployed, once provided with conditions more conducive to entrepreneurship, will in turn hire new workers.
Recruitment preparation initiatives will be implemented as early as end-2006, aiming to even out the balance between unfilled job offers and jobseekers with skills similar to those required. The said initiatives will span three months, following which the companies will commit to hire the jobseeker on a lasting job contract.
While not adding any new systems, the Government feels that more effective action can be taken on the employment front. This is true of at-risk urban areas (ZUS), to which it plans to devote greater resources and mobilise local players. ZUS prefects will put together “Employment Solidarity Groups” to focus on three topics: the underqualified, young people with no previous career guidance and housing-related discrimination.
Even before the end of 2006, the “contrat d’avenir” (Future-Building Contract) system could be extended so that a “social cohesion benefit” is paid to employers hiring people over 50, categorised among the very long-term unemployed.
Lastly, to make it easier for young people to enter the workplace, the Government has chosen to focus on the school-work transition. For that purpose, a “public guidance service” will be introduced: available to students from the last year of lower secondary school to the third year of higher learning, it will need to align its action with job market prospects. Starting as early as September 2006, an inter-ministerial delegate on guidance and job market integration will be put in charge of setting up a national guidance and job market integration plan.
Buying Power - the Logical Outcome of the Fight on Unemployment
The Government also wishes to make the current fight on unemployment synonymous with more stable buying power, and has chosen three avenues to achieve this:
The first is to tie employees into company performance. For this reason, starting as early as this Autumn, a bill on “developing profit-sharing and incentives” will be set before Parliament for consideration. Employees will receive dividends for the work they achieve, in the form of free shares. The Prime Minister describes this measure as a “guarantee of fairness and motivation” for employees.
Secondly, it will provide support to lowest-income families. The one-time grant for successful jobseekers will rise to EUR 940 in 2007, the same level as minimum wage, compared to EUR 540 currently. At the same time, debate will be launched regarding increases in minimum wage and the “inappropriate use of certain forms of particularly high compensation”.
Lastly, the Government is preparing to create a “transport voucher”, by 1 January 2007. It will discuss the concrete applications thereof with the industrial partners, aiming for procedures that are simple, effective and environmentally-friendly.
Social dialogue, already the common thread running through all of its action in the months to come, needs to become the Government’s “trademark”, in the Prime Minister’s terms. Social dialogue, he stated, “has never achieved balance in our country, and yet is a condition for improving our social model”. Jean-Louis Borloo and Gérard Larcher have begun consultation with the industrial partners to that end, in particular on the concept of a “time dedicated to negotiations”.