It was unexpected to observe that at the end of last year, the French unemployment fell to an 11-year low, according to official data showed on Thursday. This offered President Emmanuel Macron a pump on the economic front.
The unemployment rate has fallen to 8.1% in the final quarter of last year. It was 8.5% in the third quarter, which was adjusted down from a starting reading of 8.6%, according to the INSEE statistics agency.
This result brought the unemployment rate to its lowest level since the fourth quarter of 2008. It far surpassed expectations which were for 8.5% on average, according to a Reuters poll of 11 economists. None of those economists were expecting anything lower than 8.4%.
The big drop is going to be a great achievement for Macron after he struggled with weeks of strikes over a revamp of the pension system that was strongly and fiercely opposed by trade unions.
The decrement in unemployment happened even after the economy shrunk slightly in the fourth quarter, which economists mainly put down to the strikes hitting supply chains of manufacturers.
Regardless of a weak end to the year, the French economy last year outrun other big economies of Europe zone such as Germany because it has lesser exposure to exports resulting in a slowdown in global trade.
Reformed labor code of France
With a firm demand at home, French companies have constantly and steadily added to staff numbers, also encouraged by labor code changes under Macron that have allowed an easy process of hiring and firing. INSEE pointed out that not only did joblessness has decreased but the number of working people increased in the fourth quarter to its peak level since comparable records started in 2003.
The employment rate, which calculates the share of people who belong to the working-age and are in jobs, climbed to 65.9%. The jobless rate provides the number of people who are of working age and are strongly seeking or doing work.
The percentage of people who are registered for permanent labor contracts increased to 49.3%. Along with the fourth quarter of 2018 when the same rate was accomplished, it was the highest since the third quarter of 2009.
The rate has increased after Macron enforced the reformed labor code, which economists say is because employers are less tensed as compared to the past about putting people on permanent contracts that previously made it difficult to get rid of workers if business soured.
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