” On both the French left and right, by contrast, political leaders implicitly accepted high unemployment as a price for giving those in work more security and higher wages.”
The EconomistFrance’s labour code, a fat red doorstop of a book, runs to 3,809 pages, 45% longer than ten years ago. The collective-bargaining agreement for hairdressers alone covers 196 pages. “The key challenge”, concludes a recent survey of France by the OECD, a Paris-based think-tank, “is to reform the labour market to promote job growth.” Yet is this likely?
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The contrasting record on jobs across the Rhine is compelling. In 2001 unemployment in France and Germany was comparable, at just under 8%. Today it is below 5% in Germany, but over 10% in France. Although France and Germany have similarly high productivity per hour worked, the French start work later and stop earlier. Too many French youngsters leave school with no qualifications and drift for years on the fringes. The share of young people not in education, employment or training is 19% in France, almost twice that in Germany. In 2003 the overall employment rate in the two countries was similar; today it is 74% in Germany but only 64% in France. Among 55- to 64-year-olds only 47% of the French toil away, next to 66% of Germans (see charts 1 and 2).
Put simply, Mr Schröder, a Social Democrat, made the political choice to get people into jobs, even if only part-time and low-paid, rather than leave them on the dole.