The Prime Minister, Gabriel Attal, was a guest on the TF1 news program “20 heures” on March 27, 2024, where he discussed plans for a comprehensive reform of the unemployment insurance system. This reform is expected to be finalized by the summer and implemented in the fall, with the aim of increasing the number of employed individuals in order to boost public finances. The government has been vocal about its intention to introduce stricter rules for the compensation of job seekers in recent months, as the unemployment rate has slightly increased to 7.5% of the active population.
Attal stated that it is crucial to have more French people working in order to generate additional revenue, which will help alleviate the strain on public finances. The government is aiming to achieve full employment, around 5% unemployment, by 2027. The Minister of Labor, Catherine Vautrin, has been tasked with preparing the framework document that will guide negotiations between trade unions and employers on the terms of the unemployment insurance system. While trade unions and employers are responsible for setting the parameters through a convention, they must adhere to a roadmap laid out by the government.
During his interview, Attal provided insight into the government’s preferred strategies for reforming the unemployment insurance system. One proposal is to reduce the duration of compensation by several months, building on a previous reform that had already reduced it from twenty-four to eighteen months. Another option is to adjust the duration of employment required to qualify for benefits, potentially increasing it from six to eight months or condensing the required six months into a shorter timeframe. Additionally, the level of compensation could be lowered through changes in calculation methods or the implementation of new degressive mechanisms.
The reforms will be the subject of negotiations between trade unions and employers, who are expected to revisit an agreement reached in November 2023. This agreement led to a convention that required government approval to be implemented. The government will make a decision regarding the approval of the new reforms after trade unions and employers conclude negotiations on a new “pact for working life” on April 8th. The ongoing discussions include topics such as the employment of seniors and prevention of work-related fatigue. Ultimately, the government’s goal is to revamp the unemployment insurance system to encourage more individuals to enter the workforce and improve the country’s economic outlook.
