2015, just as every other year since the subprime crisis, ended on a rather negative note for the global economy. Amid disasters such as the Chinese stock market crash, France did not escape the downward trend. With an unemployment rate exceeding 10%, public debt of approximately 95% of the GDP, and a deficit of roughly 4%, France enters 2016 with a complicated economic situation.
Historically, France has struggled with unemployment. For more than 30 years, the unemployment rate has stagnated around 10%, despite a steep decrease in other countries (such as Germany and the US) and the hundreds of measures taken to combat the problem. It is a major roadblock to French economic growth, since the country’s highly developed system of redistribution and allocations diverts considerable funds towards compensating the unemployed. Even though this system prevents an overly steep decline in household demand, these allocations make for a heavy financial burden on the State. President François Hollande had made lowering unemployment one of his main objectives for his term as president, and he has recently announced his new plan: to train 500,000 unemployed workers to reinvigorate the job market and make France more competitive.
Concerning national debt, France is the 8th most debt-ridden country in Europe. This means a burden of 31,000 euros per inhabitant, roughly the average yearly revenue of a French worker. The amount of debt continues to increase despite the government’s devoting over 11% of its budget to its reimbursement. A protocol resembling austerity has thus formed in France over the past few years, requiring many reluctant households to decrease their spending considerably.
by Emma P.