World Economy

Apr 14, 2008

The unemployment rate fell to 7.5% in France, the lowest since 1983

PARIS (Reuters) - The unemployment rate fell to 7.5% in metropolitan France in the fourth quarter of 2007, falling to its lowest level in 25 years, according to figures released by INSEE.

The results of the Quarterly Survey of Employment INSEE come at an opportune time for the government to three days of the first round of municipal elections.


The Minister of Economy and Finance, Christine Lagarde, noting a "significant structural improvement in the labour market", confirmed the goal of an unemployment rate reduced to 5% in 2012.

Economists, however, expect that this upturn will not last given the slowdown in the global economy which will spare no France.

The unemployment rate of 7.5% within the meaning of the International Labour Office is the lowest since the fourth quarter of 1983, when it was 7.3%, according to the National Statistical Institute.

The third quarter of 2007 was also revised down slightly to 7.8% from 7.9% previously announced. It was 8.1% in the second quarter of 2007 and 8.4% in the previous two quarters.

On average in the fourth quarter, 27,964,000 people were active in France, or 56.5% of the population aged 15 and over. Of these, 2,084,000 were unemployed as defined by the ILO and 25,880,000 were employed, said INSEE in a statement.

The employment rate for the population aged 15 to 64 years has risen to 64.8% versus 64.4% in the third quarter and that the 55-64 age group rose from 41.3 to 41.6%, a trend Particularly encouraging judged by the Ministry of Economy and Finance.

ACCÉLERER REFORMS

"Christine Lagarde is confident in the continuation of this trend, which should continue to benefit from changes in the French economy and improving the functioning of the labour market," reads a passage in a ministry that brings to mind some 300,000 jobs created in France in 2007.

"Christine Lagarde believes that these developments confirm (...) acceleration of the reforms that it implements to free the work, support the competitiveness of enterprises and modernize the public service employment, in order to achieve a rate of unemployment of 5% and an employment rate of 70% in 2012, "adds Bercy.

"This is a sharp decline and it is understandable that the government would rejoice," writes Jean-Christophe Caffet, economist at Natixis.

"At the same time, we know that employment and unemployment indicators are shifted relative to the activity. With the slowdown at the end of last year and early this year, we believe that improving market of employment that we have experienced over the past three years is coming to an end, "he said adding that the rate of 7.5% by the end of 2007 is" certainly a low point. "

"The main determinants of improving employment in 2007 were the construction sector and services including financial services. With the slowdown in the real estate market and the difficulties facing the financial sector, it is unlikely that both engines continue to run at full, "argues Jean-Christophe Caffet.

For the whole of metropolitan France and French overseas territories, the unemployment rate stood at 7.8% in the fourth quarter against 8.2%

by erectusplus at 11:08 AM |