The jobless rate in France hovers around 10 percent. It’s more than double that among the young, and in some poor neighborhoods it soars to 40 percent.
One reason: Worker protections are so strong in France that once someone is hired, it is close to impossible to fire him, no matter how incompetent he may be. That makes employers reluctant to fill jobs with people who have a limited work history. They don’t want to take the chance.
In an attempt to introduce a little flexibility into that calcified system, the government recently passed what’s called the First Job Contract law. It will give employers more leeway to hire and fire workers who are under the age of 26. Its goal is to reduce unemployment among the young. The thinking is that employers will be more willing to hire young workers with little or no experience if it isn’t so difficult to dismiss the ones who aren’t productive.
This is not intended to punish young people. It’s intended to entice employers to take a chance on them. But the law has sparked hundreds of thousands of young people to protest, shutting down some universities. Prime Minister Dominique de Villepin has been vilified by the protesters and France’s powerful public-sector unions.
Union employees don’t face a great risk–the union bosses do. If this law reduces joblessness among the young, the government might try to introduce more flexibility into the labor market for older workers. The unions’ stranglehold on French labor policy might be broken.
France has long disdained America’s burly brand of capitalism. American workers do have less job security than the French–but more have jobs. The churning American economy has produced more robust growth and a much lower jobless rate than France’s. After a disturbing period of job loss, America’s economy has created 4.3 million jobs in the last two years.
In the last year, an average of 4.5 million workers left their jobs each month, but 4.8 million workers were hired. That’s a net gain of about 300,000 new hires each month. The jobless rate for young people in the U.S. is less than half that of France. In the U.S., it’s 10.7 percent for those who are ages 16 to 24. It is 8.5 percent for those who are 20 to 24.
There is uncertainty in economic churn–and it’s terribly acute when it’s your job that goes away. But lifetime job security doesn’t mean much when you can find no job in the first place. The young may take to the streets in France, but the First Job Contract could give them something more gainful to do.
