France 's A High Unemployment Rate Essay

1343 Words Nov 14th, 2016 6 Pages
For the past several years, France has seen a high unemployment rate plague the country’s economic growth. The root of this macroeconomic issue stems from France’s outdated labor market, which has been criticized for its structural inflexibility, high labor cost, and structural unemployment. The repercussions of France’s unemployment crisis places pressure on the government to help mitigate and resolve this economic issue. With reelection months away, France’s current president, François Hollande, has vowed that he will only run for reelection if he successfully lowers the unemployment rate.
In response to high unemployment rates, President Hollande is looking to revitalize job opportunity mainly through a labor market reform policy. The proposed new job reform intends to “simplify labor rules, facilitate lay-offs in case of economic slowdowns and allows companies to strike deals with their employees on overtime” (Chassany). The policy attempts to address France’s hindering dual labor market, which has been attributed to France’s job protection and worker compensation laws. Those who are currently employed benefit from such a system with a higher pay, job security, and often promotion prospects. Those who are not, especially younger people, are put at a disadvantage, given access to obtain only short-term work or no work at all (Walker). As a result, the structured system creates unnecessary barriers for employers looking to fire underperforming employees and it also closes…

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