Access to unemployment benefits in France is to be tightened, the prime minister has announced, saying it is the next stage in a “push towards full employment”.
The unemployment rate stands at around 7.5% in the first quarter of 2024, having fallen from over 10% in 2015.
In an interview with La Tribune on May 26, Prime Minister Gabriel Attal announced new restrictions to qualify for unemployment benefits while championing the role of President Macron’s economic policies in cutting France’s unemployment rate.
“The rate is lower than it has been for 40 years,” said Mr Attal. “We have demonstrated that we are not condemned to suffer from mass unemployment forever.”
The new limits on qualifying for benefits are meant as “fuel to drive the unemployment rate down further,” said Mr Attal.
Under the plans, people will have to work for eight out of the previous 20 months to qualify for benefits. At present, they must work for six out of the previous 24 months.
In France people receive a percentage of their previous salary rather than a set amount as applies in many other countries.
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The duration of the benefits will remain unchanged so long as the unemployment rate stays below 9%. Benefits last for 15 months for people below the age of 55, and 27 months for people older.
However, if unemployment falls to 6.5%, the duration of unemployment benefits will be cut by a further 25% in accordance with France’s model of contracyclicité, or counter-cyclical fiscal framework, introduced in February 2023.
“Our system will still be more generous than that of our neighbours,” said Mr Attal. “In Portugal and in the UK, it is 12 out of 24 months, and in Belgium it’s 16 out of 33 months”
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The new reform will be introduced by a decree on July 1, he said, and come into effect on December 1, 2024.
“This is not a reform for budgetary reasons, but to create jobs and prosperity”
Nonetheless, it is expected to save the government €2.8billion, according to the workers CGT union.
Towards a bonus for over-55s
Workers over 55 who return to employment on lower pay, might be able to keep receiving their unemployment benefits in future to make up for the difference, said the prime minister, however the plans for this have not been finalised.
“I have asked [Labour Minister] Catherine Vautrin to identify sectors in which this system could be applied and how long it would take,” he said.
The reform - if it goes ahead - will apply for all workers over 55 earning less than €3,000 during the first year of a new work contract if their new job pays less than their previous one.
