The consultation on the reform of the unemployment fund gets to the heart of the matter. The social partners have an agreement on Monday for a first meeting with one purpose: to modulate the compensation rules according to the economic situation. In a working document, which will serve as the basis for this consultation, the government describes over 25 pages the goals and possible paths.
The government wants to move quickly. Only three meetings with the social partners are planned. The first this Monday, then two others in November, so that the new rules can come into force, from the beginning of 2023. For the executive power, it is indeed urgent. Despite an unemployment rate of 7.4%, companies have never had such difficulty recruiting. This is the case for more than 67% of companies in the manufacturing industry and more than 59% of service companies. Historically high levels that sometimes penalize activity.
However, according to the executive board, these difficulties are partly related to our unemployment insurance system, which does not fully play its role. “The model is not protective enough when the economic situation worsens. It is too protective when the economic situation improves, Labor Minister Olivier Dussopt explains with supporting figures: “In a period of job creation, the proportion of job seekers entitled to the compensation exceeds 60%, while it drops to 45% in times of economic depression.” “A paradox,” he says. Hence the idea of modulating the rules according to the economic situation.
Reduce the duration of the compensation or tighten the conditions
For this, two questions need to be discussed. First, how do you modulate the rules? One track has already been ruled out. No doubt for the government to lower the amount of compensation, while on the contrary it is trying to strengthen purchasing power. There are two main options left: either to play on the duration of the quotas or to play on the conditions for opening the rights.
Today, the maximum duration of benefits varies according to age and is 24, 30 or 36 months for people over 55. Olivier Dussopt has already mentioned the idea of lowering the maximum duration for the latter. It can therefore be reduced to 30 or even 24 months.
Another option, to play on the conditions of opening the rights. They have already been tightened during the previous reform. Today, it is necessary to have worked 6 months out of the last 24 to be compensated. Tomorrow it may be necessary to work 7 or 8 months over the same reference period… or still work 6 months but over a shorter period, 18 months instead of 24. These are the paths that will be discussed with the partners. .
When will the rules be tightened?
Then it remains to decide, based on which criteria we assess that the market is or is not growing, and therefore when the rules will become stricter. Here again, there are several paths on the table. Should we take into account unemployment, which is “the most readable indicator” but includes “part of the danger”, the Ministry of Labor emphasizes, or rather indicators of tensions, such as recruitment difficulties?
For Olivier Dussopt, the unemployment rate is not necessarily the best criterion because it can vary quickly. “I believe more in the relationship between the number of job vacancies and those of job seekers, or even the tensions over recruitment,” he said during a hearing in the National Assembly.
The Ministry of Labor also admits the complexity of the exercise. In his working document, he clarifies that regardless of which indicators are used, it is not certain that they reflect the situation on the labor market with full accuracy. As a safety measure, he therefore proposes that an expert committee be set up to give an opinion before the compensation rules are tightened.
No modulation according to regions
Finally, it seems that the idea of adapting the rules according to the regions has now been ruled out, except for the overseas territories. In any case, the Ministry of Labor insists on all the problems it would cause. It would be too complex, legally complicated and “it would risk hampering the mobility of jobseekers”, we can read in the document.