French President Francois Hollande said he was sticking to a target of cutting down unemployment by year-end, after fresh data showed that the number of jobless hit a new all-time high in April.
In a stark illustration of the challenge facing the Socialist president, the 3,264,400 registered job seekers in April marked two uninterrupted years of monthly rises and a 1.2 per cent increase on March.
Nearly 337,000 more people are out of work in mainland France than there were when Hollande was elected in May last year.
“Despite this data, despite what it means for many French people individually or for their family, I maintain the goal of reversing the unemployment trend by year-end,” Hollande told a joint news conference with German Chancellor Angela Merkel.
In Germany, despite a jump in May due partly to bad weather, unemployment is close to a reunification low, while in France it stands at the worst level since records began in 1996, highlighting the growing divide between the euro zone’s two major economies.
To make things worse, young people have been the hardest hit by the April rise in unemployment in France, with a 2 per cent monthly increase in the number of job seekers under 25. Just over one in six job seekers in France is now under 25.
Hollande, whose poll ratings have fallen faster than for any modern French president as the economy slid into recession, is pushing alongside Germany and other euro zone countries to speed up an EU plan to devote 6 billion euros (HK$60.5 billion) for youth employment for next year-20.
The government is holding to its pledge to turn around the trend by year-end despite multiple forecasts to the contrary, hoping that the economy will start to pick up in the second half of this year and that subsidised jobs will help keep a lid on unemployment.
“We believe it may take between 6 and 12 more months to see the trend changing,” said Dominique Barbet, economist at BNP Paribas.
“However, this rising unemployment is also the most effective incentive for the government to deliver the structural reforms that the European Commission asked for yesterday, and also the main reason why the public opinion is more open than ever to such usually painful reforms.”
The European Commission, the OECD and France’s own jobless benefit fund all see unemployment continuing to rise through next year. The EU executive said on Wednesday it expects French unemployment to reach 10.6 per cent this year after 10.2 per cent last year and keep increasing to 10.9 per cent next year.
Looking at the last five years, April was the 53rd month out of 61 showing a rise, highlighting France’s chronic job crisis as the economy fell back into recession in the first quarter and jobless figures are being driven up by industrial layoffs.
During the past two years of uninterrupted rise alone, unemployment rose by over half a million in France’s near-66-million strong population.
The labour ministry data is the most frequently reported jobs indicator in France, although it is not prepared according to International Labour Organisation (ILO) standards nor expressed as a percentage of job seekers in the work force.
France will publish first-quarter ILO data on June 6.