* cababarant *

Thursday, April 13, 2006

Chirac caves, French go back to jobs they don't have yet

Okay so enough with the D-list goss, on to real politics!

So the big news this week in Europe (aside from, of course, the bigger news of crazy Berlusconi losing the Italian election), is that the French government has voted against the labor reform proposal that "young France" was protesting against. For anyone who hasn't been following it, the labor reform would have consisted essentially of allowing companies to freely fire employees within the first two years of employment, primarily affecting young people just out of school and new to the job market.

Every time I think "hey, maybe the French are normal", they seem to behave as a society that convinces me they're from another planet. It's true, Europe in general has far more protectionist labor law in general compared to the U.S., but France's policies are something else. What the protesters don't seem to take into account is that for companies, easier to fire means easier to hire-- that as a result, it probably would be easier to get a foot into the job market to begin with. In a country with 22 percent unemployment for people under 26, you would think this sort of labor reform would be a good thing. It's kind of like what my friend Steve (who lived in France long enough to, first hand, experience good ol' French policy) said about policies governing tenant leasing: because French law makes it damn near impossible to evict someone, it eventually backfires on those it's trying to protect-- it makes it damn near impossible to even lease a house or apartment. There are copious amounts of documentation, background checks and referrals that are necessary in order to even be considered. I think the general unemployment rate there seems to be evidence of the same effect French labor policy has on the job market.

Okay, I'm not going to go totally wacko free-market economist here. (Although living in Europe does have this way of turning an American expat into one!) I don't think what the French have is bad-- in fact, it's hard to argue with what you get once you do have a job there: excellent job security, great vacation policies and working hours that give you great work/life balance. As an American, I don't think I have experienced any of those things 100 percent (although I have had good experiences, not relative to the French, but relative to other American workers). But, the French need to look pragmatically at the staggering unemployment rate and figure something out.

The interesting thing is that the labor reform proposal was partially a response to the riots from last November-- in which angry, marginalized minority youth set fire to cars and their neighborhoods, so the French government deduced that perhaps high unemployment has something to do with that. They promised change after those riots, and now have promised some sort of other change after the last two months' riots and protests, so I guess we'll just have to open a bottle of delicious French wine, and a raw-milk Camembert, and watch this French sideshow continue. Salut!

Links
Slate.com: France's March Malaise
NYTimes: Chirac Will Rescind Labor Law That Caused Wide French Riots
NYTimes.com: Déjà Vu All Over Again

How you like us now, Villepin?

posted by sheryl | 10:41 AM |

Comments: (1)

I have two comments on this subject:

1/ A big irony of the university students protesting the law against firing young workers is that most of them will finish university *after* age 26 anyway; the law was written to not apply to anyone over 26. So they were protesting a law which would not affect a great many of them.

Additionally, the law was originally meant to get disadvantaged youths into the work. The biggest problem with getting people outside mainstream France into the workplace starts with the fact that people with non-traditional French names (especially of Northern African origin) get their resume's thrown in the garbage can as soon as they come in: they have no chance because of their ethnic background.

The demonstrations was a mix of a gap between the out-of-touch governing classes and the public based on perception and fear. My sense is that France these days feels like an unbalanced society with a general undercurrent of fear for the future.

2/ On the topic of high unemployment across Europe compared to the US, the Economist made an interesting point some months ago: they argued that while Europeans take the stand that the Anglo-Saxon model of hiring and firing hurts workers, in actuality it damages an individual in many more ways to be long-term unemployed than to have work. In other words, it is unethical(? -- I wish I could find their words exactly again) of European governments to accept high unemployment rates, condemning significant percentages of their populations to idleness and frustration rather than seeking a way to give the maximum number of people work, and therefore a sense of purpose and personal growth. I have always thought it was an argument of ethics (standard European governments) versus business (Anglo-Saxon), but I liked how the Economist put the argument on equally ethical terms on both sides.
By Steve Z 10:43 PM