Sunday, August 05, 2007

DATA SNAP: French June Unemployment 8.0% Vs 8.1% In May


By Geraldine Amiel Of DOW JONES NEWSWIRES PARIS (Dow Jones)--

France's unemployment rate eased in June to 8.0% from May's 8.1% and stands at its lowest in 25 years, the French national statistics agency Insee reported Monday. The number of registered jobseekers fell by 34,000 to 2.206 million. This is better than expected, as economists polled by Dow Jones Newswires had forecast unemployment to fall by 19,000 and to remain stable at 8.1% of the working population.

The latest data bode well for the government of Prime Minister Francois Fillon and the French President Nicolas Sarkozy, who deemed the fight against unemployment as one of their top priorities. Sarkozy has pledged to overhaul the French labor market to boost employment. Last week, the French Senate approved the government's tax relief package, designed to boost French growth and employment. The government also plans structural reforms and to implement legislation on labor, employment and purchasing power. The French National assembly is to study this week labor law reforms.

A study by the Organization for Economic Cooperation and Development published in June backed the government's program, as it urged France to reduce unemployment and get more people into jobs to boost economic growth and increase the sustainability of its social insurance system. In order to boost employment, job protection legislation needs to be overhauled, the OECD said. It encouraged the French government to introduce a single work contract, allowing job protection to increase gradually, in line with experience within the firm.

Former Labor Minister Jean-Louis Borloo earlier this year forecast that unemployment is likely to fall to 7.9% by the end of 2007. French unemployment data are under scrutiny after Insee, which compiles part of the the jobless data for the Labor ministry, announced in March that it delayed publication of final 2006 figures to September because a high number of non-respondents hurt its polls.

Trade unions and staff of the Dares, a service of the Labor Ministry that supervises the publication of the figures, called a strike in April to oppose the publication of estimations of unemployment, which they deem unreliable. On March 30, European Union statistics agency Eurostat estimated France's joblessness was at 8.8% in February, well above the government figure published by the Ministry the previous day.

-By Geraldine Amiel, Dow Jones Newswires; +331 40171740; geraldine.amiel@dowjones.com; (END) Dow Jones NewswiresJuly 30, 2007 13:15 ET (17:15 GMT)

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