The Unrest in France

By April 6, 2006Economy

Business is UpThe protests over the past weeks by youth of France highlight the frustration that a stalled economy can produce. Just think, over the past 5 years, France’s economy has achieved an average annual growth rate of just 1.4 percent. With this anemic performance, is it any wonder that France’s unemployment rate, at 9.6%, is double that of the U.S.?

The controversial new law, called the Fist Employment Contract, aims at making it easier for employers to both hire and fire young workers. Currently, the unemployment rate for men under 25 in France stands at nearly 21 percent (up 38% from the level 5 years ago). So while its understandable that concerns about job security have elevated, its also painfully obvious that job security without growth opportunities in an oxymoron.

The French government took a necessary step to add some flexibility to its labor market. Maybe the rest of Europe will learn from this move and take their own steps to reinvigorate their own economies, and take the pressure off the U.S. to be the sole engine of economic growth in the world

Join the discussion 2 Comments

  • Andrew says:

    Look further west of Britain, Ireland to be exact, to validate the theory that low taxes and less regulation lead to economic growth.

  • Ryan says:

    Unlikely that other european countries will take steps to improve their economies. A poll of young people in france taken a couple of weeks ago said that 2/3 of frech youth want to work in the government because “they’d have a job for life”.

    Germany isn’t much better off. With unemployment at 10% they need much bigger reforms to help jump start their large economy. Hopefully Merkiel their new female prime minister can push throw reform.

    Tony Blair looks like he’s on his way out, and though he has reformed health care, eduation, and stuck to liberal market capitalism, britain still has a way to go.

    I’d say Britain is the best hope for continued growth and germany and france although huge economies they will continue to fall behind.