French unemployment levels reach 11-year low

by Theo Bourgery-Gonse

The number of job-seekers in France dropped by 3.6% in the last quarter of 2022 to 3.05 million, the lowest figure since 2011, but the French Central Bank warned that the unemployment rate might go up again in 2023.

Over 2022, the number of job seekers decreased by 9.3%, according to the latest data by France’s labour ministry published on Wednesday (25 January). The 3.6% drop in the last quarter means 114,400 people have been lifted out of unemployment in the past three months.

When accounting for people who work part-time but would like to work more, however, the overall drop in the number of job-seekers is contained to 0.8% over the last quarter and by 5.1% over the entire year.

The drop in job-seekers is particularly significant for those aged 18-25 (-9.8%) and those over 50 (-8.9%). These numbers do not account for French overseas territories.

According to the national statistics body, the national unemployment rate stood at 7.3% in the third quarter of 2022.The new unemployment rate for the last three months of 2022 (as a fraction of the active workforce) has not yet been published.

In comparison, the eurozone employment rate stood at 6.5% in November, a record low.

Unemployment rate on the up in 2023

While this might speak to the resilience of the French economy at a time of slow growth and increasing prices, the French Central Bank warned in its 2023 macroeconomic projections that lagging economic growth could push the unemployment rate up to 7.5% and 8.2% in 2024.

French President Emmanuel Macron set a target of 5% unemployment by the end of his term in 2027.

This also comes amid a set of structural economic reforms in France, targeting unemployment benefits and the pension system.

From 1 February, if the national unemployment rate falls below 9%, job-seekers will see the duration for which they are eligible for benefits fall by 25%. If the unemployment rate rises above 9% or increases by more than 0.8 percentage points in a three-month window, the benefit eligibility will revert to the previous duration.

At the same time, a critical pensions reform is underway, due to reach Parliament next week. At the heart of the reform is an increase in the minimum retirement age from 62 to 64. The government argues that this would further increase employment rates, especially for the 55-64 age group.

*first published in: Euractiv.com