Thursday, March 28, 2024 | Ramadan 17, 1445 H
broken clouds
weather
OMAN
23°C / 23°C
EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Is France’s leader rebooting the economy?

minus
plus

Leigh Thomas -


French President Emmanuel Macron swept into office last May on a pledge to create jobs and improve the lives of workers by rebooting the country’s economy.


A year on, annual economic growth has picked up — closing the gap with Germany and pulling away from other major European powers such as Britain and Italy.


The pace of new business openings have increased sharply and improvements in the jobs market have left some employers warning about skilled workers being in short supply.


But economists say the rosier picture is due at least in part to stronger growth across Europe as well as policies put in place by Macron’s predecessor, Francois Hollande.


The data show some early signs that the president’s policies are having an effect among entrepreneurs and in the labour market.


But there has been little change in disposable income for workers and efforts to reverse years of declining competitiveness don’t appear to have borne fruit.


Macron’s ability to re-invigorate the euro zone’s second-largest economy will be a critical factor in how his success is measured at home.


It will also shape how much influence he can bring to bear in Europe, where he is trying to convince Germany of the need to further overhaul economic and monetary union to bolster the euro zone against future crises.


While the economy grew quickly after Macron’s election, its lowed at the start of this year due in part due to one-off factors that curtailed consumer spending, according to figures. Economists said they expect growth to return to a healthy clip.


Macron has repeatedly said his reforms would start to have a significant impact 18 months to two years into his presidency. An Elysee adviser said there was no time frame for improving the economic outlook. “That’s why we’re not cheering about the current upturn, because we’re perfectly aware that to a large extent it’s down to the economic context.”


When Macron took office in May, the French economy was starting to rebound after years of unimpressive growth.


That gave him a firm footing on which to confront France’s historically muscular trade unions as he seeks to reshape economic and social policy.


A former investment banker, Macron had been a minister in the Hollande’s government, before quitting to launch his own political movement.


Barely a year later, aged 39 years, he led it to electoral victory casting himself as an agent of change,of ‘neither of the left nor the right.’ Macron quickly moved to start overhauling France’s labour regulations to tackle unemployment, which was well above the euro zone average.


Macron’s government has provided employers more freedom to hire and fire through a loosening of labour rules, among other measures. Initial signs appear promising for Macron.


Overall unemployment in France is down to 8.9 per cent, from 9.4 per cent when he took office and below the 9.1 per cent average for the country over the last 20 years, according to France’s INSEE statistics agency.


Youth unemployment is falling at an even faster pace.


Companies also are more frequently hiring on permanent contracts as opposed to short-term ones.


The level approached 49 per cent in February, a level only rarely seen over the past two decades, according to Reuters analysis of data from the ACOSS national payrolls agency. However, economists say the increase in permanent contracts appears only partly due to Macron’s policies as numbers were rising before he assumed office. — Reuters


SHARE ARTICLE
arrow up
home icon