France Desperately Needs Workers, but the Fixes Could Anger Left and Right

https://www.nytimes.com/2022/12/23/business/france-jobs.html

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The sign on the window of Red Rhino, a popular barbecue restaurant in central Paris, has been up for a month: “Closed until further notice due to lack of personnel.” Bus and train service has been cut back in the tourist city of Lyon amid a dearth of drivers. In the Loire Valley, tons of vegetables went unharvested in the summer as thousands of picking jobs were left unfilled.

Economic activity has fitfully revved up again in France and across Europe since the end of Covid lockdowns, only to be knocked back by the effects of Russia’s war in Ukraine. Even so, employers in numerous industries remain desperate to hire, with a range of businesses still not finding the workers needed to operate at capacity.

All of which has prompted France, Europe’s second-largest economy, to seek a variety of solutions — all of them politically combustible.

President Emmanuel Macron’s government is proposing a fast-track legalization for undocumented migrants who are already in the country and want to work in sectors facing staff shortages.

For added measure, the government is moving to tighten France’s famously generous unemployment system, with its lengthy benefits, in a bid to cycle jobless people more quickly back into the work force.

The plans have met with resistance from different ends of the political spectrum. Lawmakers from France’s rising far right say a growing influx of migrants must be brought under tighter control and that French nationals should be given priority for jobs. The country’s powerful labor unions are warning that measures to cut jobless benefits risk pushing the unemployed toward poverty.

For thousands of businesses that form the backbone of the economy, the double-barreled approach has become necessary to help fix to what appears to be a permanent shift in workplace dynamics since the pandemic, as European workers in droves switch jobs or decide not to return to strenuous work that demands early or late hours on relatively low pay. Over half a million people in France resigned in the first three months of the year, the highest level in 15 years, France’s statistics agency reported.

“Our society after the pandemic has a different outlook,” said Thierry Marx, a Michelin-starred French chef who is the president of Umih, France’s influential trade association of restaurants and hotels. “People are saying, I don’t want to have a sacrificial relationship to work.”

The shortage is tightest in construction, transportation, nursing and agriculture, where nearly 400,000 jobs are vacant in France alone. The hospitality industry is particularly hard-hit, with an estimated quarter-million vacancies, mostly in manual posts including cleaning and wait staff. That has created a further squeeze on restaurants and hotels as tourism has come roaring back in Europe after the pandemic.

At the Hotel des Grands Boulevards, in the Sentier district of Paris, the lobby bustled with visitors on a recent day. But Olivier Bon, a co-founder of Experimental Group, which owns the hotel and several others in Europe, said it had been a struggle to recruit people to help meet the postpandemic rebound, especially in kitchen or table service jobs that come with long hours and capped wages.

“A lot of workers have disappeared — it’s a fight to get them,” he said.

To make the hotel and its restaurant more attractive, the company now offers more entry-level jobs that can lead to careers in the industry and has increased internal promotions. The group has raised wages modestly, according to a new salary scale agreed to by the industry, and cut back on lengthy gaps in the workday at its restaurant that drag out employees’ shifts. The restaurant now stops service at 10:45 p.m. to improve hours for workers.

Labor unions say the issue is not a shortage of workers but low wages. If companies increased pay, unions argue, they would find employees.

“People want to be paid decently and treated as more than just a labor unit,” said Denis Gravouil, an official with the C.G.T. labor union, France’s second-largest labor organization. “Employers will find workers if they change conditions.”

Employers say the predicament is more complicated. In France, for instance, where joblessness is near a decade low of 7.1 percent, payroll taxes are among the highest in Europe, which companies claim hinders hiring. Retraining programs have helped people transition to new work in technology or manufacturing, but have had less success attracting people to work as bus or truck drivers, home care aides or caterers, where shortages are rife.

And with unemployment overall in the eurozone near a record low, some economists say labor shortages are unlikely to disappear despite an expected recession. “Countries and sectors with particularly hot labor markets could remain tight,” said Bert Colijn, senior eurozone economist at ING Bank.

France is betting that immigrant labor may help fill the gaps. A bill that Parliament is expected to take up in the new year would create renewable one-year “skills in demand” residence permits for undocumented migrants, who could apply for fast-track legal status without going through employers. For asylum seekers, the bill would also do away with a prohibition on employment during their first six months in the country.

France isn’t alone: Germany is preparing to change its migration policy to attract people to medical, technology and low-skilled jobs like catering work. The Netherlands has announced similar plans to draw in more immigrants qualified for those kinds of roles.

In France, companies say change is needed because the process to approve a work permit can take up to two years. Lengthy gaps for renewing work permits can also leave around 20 percent of immigrant workers operating illegally at any given time.

The government said the plan would also thwart unscrupulous employers from keeping workers off the books in order to exploit them with long hours and below-legal pay, which officials say is especially problematic in construction.

Still, Mr. Macron is having to walking a fine line: The bill would notably also speed the expulsion of some undocumented immigrants, particularly those convicted of crimes.

“It’s about integrating better and expelling better,” Mr. Macron’s interior minister, Gérald Darmanin, told French radio. “We want those people who work, not those who rob.”

Such talk inflames Mr. Marx, who is the son of Polish immigrants and now heads a gastronomic empire in France, having worked his way to chef stardom from a troubled upbringing in a modest neighborhood of Paris. He said it was counterproductive to conflate the issues.

“As soon as we talk about the word ‘immigration,’ it becomes a political tool, which is dangerous,” he said. “A business manager is not looking at whether a person comes from immigration or not: They are looking for a solution for the company.”

Mr. Marx said the measure would benefit workers at restaurants across France — including his — whose work permits expire while renewal is pending.

“Being an immigrant does not mean delinquency,” Mr. Marx added. “Let’s be honest. If we were to take immigrants out of the work they’re doing for only three days, this country would come to a standstill. But no one will dare to say that. They say, no it’s not true, the French need these jobs.”

France’s powerful agricultural industry has also thrown its weight behind the measure. Over 70,000 seasonal picking positions on farms went unfilled this summer, leaving tons of produce unharvested, said Christiane Lambert, the president of France’s main agricultural union.

Businesses are also backing the proposed changes to France’s unemployment system, hoping they build on changes adapted in Mr. Macron’s first term, when the government moved to curb benefits and get the unemployed into government-backed training programs.

But thousands of enterprises are still struggling to recruit, said Éric Chevée, vice president of France’s confederation of small and medium-size businesses.

“We simply can’t find workers, especially for low-skilled jobs,” Mr. Chevée said. “The system still creates incentives for people not to return to the job market who should be there,” he added, echoing a complaint of many employers.

Mr. Macron’s latest plan involves adjusting the length of jobless benefits based on France’s unemployment rate: When it falls below 9 percent, the duration of compensation would be reduced by 25 percent, with a minimum of six months. An unemployed person who would have been entitled to 12 months of jobless benefits, for example, would get nine. People over the age of 55, who can get up to three years, would see benefits cut by up to nine months.

Labor unions say the measure threatens to force more people into poverty by cutting the length of benefits and forcing the unemployed to take any job, including work that is beneath their skills.

“This government has only one priority: to hit the workers, force them to accept precarious jobs, because that is one of the objectives of the reform and saving money is a measure that is totally favorable to employers,” said Mr. Gravouil of the C.G.T. union.

“But it’s not by cutting unemployment benefits that we will fill jobs,” he said.