Hollande Vows to Tackle Rising Unemployment, but the French Are Skeptical
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Version 0 of 1. PARIS — President François Hollande visited an employment center in France’s heartland this week, armed with promises to reduce record unemployment. That was not enough for Nathalie, a 50-year-old who has long struggled to find work. News cameras captured the scene as Nathalie pushed her way in front of him and demanded to know what he was going to do for people like her. She had searched for a job to support herself and her children for more than a year without success, she said, and was now living with her parents. “That’s why we’re here, to find solutions,” Mr. Hollande told her, looking slightly uneasy. “No, but what are you going to do?” she persisted as Mr. Hollande tried to walk away. “I’m not hearing anything concrete.” It’s a sentiment Mr. Hollande has been hearing from business owners, financial analysts and international bankers. He has spent his summer pursuing a daunting task of reassuring the French that the economy will exit from recession. He hopes to reverse a persistent rise in unemployment, which has marched steadily higher as France loses its economic competitiveness. As part of a campaign to lift morale, he has pledged to create thousands of state-subsidized jobs. He pins his hopes on the signs of a recovery in his country and across Europe that suggest the economy might start to grow as early as next year. “It’s still fragile and precarious, but something is happening with the economy,” he said on Tuesday. Still, despite a recent spate of positive data, France has made little progress. “We do not think that we will see growth strong enough to reverse the upward trend in unemployment just yet,” Ernst & Young analysts said in a note to clients, referring to the euro zone. “So as far as households are concerned, the worst is not quite over.” Last week, Mario Draghi, the president of the European Central Bank, sounded a similar note. Analysts, one after the other, repeated the same story. And each new report seems to deepen a sense of gloom among French households. “We must not succumb to self-criticism,” Mr. Hollande told the French in a speech last month. “For years we have been the most pessimistic country in Europe, in the world even. There are countries at war that are more optimistic than we are.” In its report this week, the International Monetary Fund forecast that France’s jobless rate, which hit 11 percent in June, would climb to 11.6 percent next year before recovering slightly in 2015. Youth unemployment is close to 26 percent. For people like Nathalie, the situation is also painful: unemployment among people who are 50 years old or more has risen to 7.1 percent from 4.7 percent in 2008, before the financial crisis hit, according to the statistics agency Insee. A big part of the problem is that few private sector jobs are being created. Many new jobs are on temporary contracts, which give employers more flexibility but often end with the worker cycling back onto the unemployment rolls. Mr. Hollande, whose popularity is at a low in polls, has sought to counter the trend. In the spring, the French legislature passed a modest loosening of the country’s labor code designed to encourage hiring. And recently, after businesses objected, Mr. Hollande reversed a decision to raise the capital gains tax in a scramble to raise 20 billion euros for the 2013 budget. The I.M.F. also suggested that the government stop raising taxes, and focus instead on reducing government spending, which makes up 54 percent of France’s gross domestic product, one of the largest levels in Europe. But with the economy grinding ahead too slowly to create jobs, Mr. Hollande is using the state to get the task done. Crisscrossing France in recent weeks, he announced plans to cut unemployment by the end of the year, mostly by promoting government-subsidized work. About 30,000 new playground assistants and classroom aides would be hired to welcome children back to school in September. A series of job training programs to match the unemployed with job vacancies is aimed at taking up to 100,000 people off the dole, at least while they are in the programs. And on Saturday, in southwest France, Mr. Hollande said he would create 5,000 “jobs of the future” for unemployed people under 30 by the end of the year, by granting businesses 5,000-euro tax breaks for each person they hire. Rather than hope, however, the announcement appeared to unleash a wave of cynicism. Whether Mr. Hollande convinces the French remains to be seen. On Wednesday, a survey released by the polling company Ifop found that 84 percent of French people said they did not believe he would be able to reverse the rising unemployment by the end of the year. |