When the global financial crisis erupted in 2008, some expat French bankers who lost their jobs in London returned home to collect unemployment benefits of more than 7,000 euros ($8,000) a month.
Though an extreme example of French welfare generosity, the maximum jobless payout of 7,130 euros a month for two years — or three if you are near retirement — is a stark reminder of why President Emmanuel Macron wants to overhaul the system.
Having pushed through changes to France’s 3,000-page labour rule book this month, the 39-year-old president, a former investment banker himself, is looking to take on the opaque world of unemployment insurance in the weeks ahead.
The aim is to spur those who lose their jobs to get back to work more quickly and fill France’s growing number of vacancies, part of what Macron terms “an unprecedented transformation of our social model and economy”.
Apart from the Communist-rooted CGT, most unions have not bothered to demonstrate against the labour law and the few demonstrations there have been — including by truckers on Monday — have struggled to get media attention.
But Macron knows unemployment benefit changes are likely to encounter stronger protests, and also infuriate employers.
While usually on opposite sides of debate, France’s unions and employers are both protective of their decades-old grip over a system worth billions of euros which they manage.
“We don’t want this to become an attack on joint management because we think we have shown we can manage unemployment insurance,” said Michel Beaugas, head of labour policy at Force Ouvriere, France’s third largest union.
The government has little control over how much and for how long the unemployed receive benefits, which are negotiated by unions and employers every two to three years.
Macron wants to bring the benefits fund, known by its acronym Unedic, under state control, arguing that the government should have “more than a word to say” since it guarantees the fund’s 30.5 billion euros ($36.5 billion) of debt.
For the unions, retaining a say in how Unedic is managed is equivalent to staying relevant.
Membership is already among the lowest in the developed world and declining and the labour reforms have weakened their power to negotiate for employees.
Though employer federations feel less threatened, they too are reluctant to see the system slip from their grasp.— Reuters
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