“We won’t achieve full employment”: Bruno Le Maire warns of the limits of the French system

Emmanuel Macron had made this the priority ambition of his second five-year term: in 2027, France will reach full employment, falling below 5% unemployment. Questioned in the France Inter morning show this Monday, the Minister of Economy and Finance Bruno Le Maire nevertheless buried the presidential promise. “With a constant social model, we will not succeed,” he assured. According to the author of The French Way, to be published this Wednesday, it is French specificities which are holding back full employment in France.

The unemployment rate reached 7.5% of the active population in the fourth quarter of 2023 in France. If this figure is far removed from the double-digit unemployment rates that France experienced during the previous decade, it does not satisfy Bruno Le Maire. “Why is there a 2% gap between full employment in France and elsewhere?” asked the Minister of the Economy. “There is a problem of training, matching supply and demand, and the subject of unemployment insurance,” he said by way of explanation. As the Bercy tenant recalled, the French model allows for a compensation period of up to 18 months, one of the longest in Europe. “This is what maintains a level of unemployment at 7% as a lower level. I believe in work, I think that it structures a society, if we had full employment I wouldn't even have to worry about public finances: we would have solved the problem by 90%”

Bruno Le Maire thus declared that he “totally shares the appreciation” of the Prime Minister regarding a possible reform of Unemployment Insurance. “I think we must first touch on the duration,” however, qualified the Minister of the Economy. The latter did not take up the idea put forward by Gabriel Attal of a joint reduction in the amount of the allowance. “I think that would be a mistake,” he commented. The boss of Bercy particularly wants to reduce the duration of compensation for job seekers over 55, particularly hard hit by the job market. “The unemployment rate for seniors in France is too high, the employment rate for those over 55 is one of the lowest of all developed countries, it’s a waste; reducing the duration of benefits is not the only solution, but let's look at it,” he argued, before denouncing “the hypocrisy of the current system, which directly puts unemployment into retirement”. “We know that the longer an elderly person remains unemployed, the less likely they are to find a job, which is why we must support them and make comprehensive proposals,” concluded the Minister.