Europe’s lost generation
PRESIDEnT Emmanuel Macron will be chuffed that France’s unemployment rate has fallen again, albeit by a fraction, to 9.5pc. This leaves an astonishing 2.65m of the French population unemployed but at least the back has been broken.
That’s the good news, for the French and the eurozone, which is now showing some stirrings of growth. now for the bad news. The young Sun King who made labour reform such an integral part of his En Marche campaigning will not be so happy to see that the figures disguise another 0.9pc percentage point rise in the jobless rate of 15-to-24-year-olds.
Macron must be looking on enviously at Britain where we seem to be rather good at creating jobs. Or at least he should be.
The UK has the lowest unemployment rate at 4.4pc since 1975. That’s a record 32m people in work, up another 125,000 in the last three months. Compare that to France’s 20,000 increase over the same period.
There are many reasons why we are more nimble than France, or indeed, the rest of the EU at making jobs.
Our labour laws are not as strict as those in France so employers can take more of a risk in hiring at a lower cost. It’s true that French workers are more productive than their UK peers – a French worker finishes the same job by Thursday lunchtime that it takes a British worker to achieve by Friday. But we have chosen jobs over productivity.
The French president, who is a great admirer of George Osborne, the former Chancellor with whom he has something of a bromance, will need some of the UK’s supply side flexibility if he is to have any impact at all.
More pertinently, he will have to be prepared to be bloody in his battle with France’s unions if he’s to get anywhere.
At least he’s willing to have a crack, unlike other EU leaders. Today, there are 18.73m people unemployed across the 28 EU countries, some 14.7m in the euro area. Unsurprisingly, the only country in the eurozone that has increased jobs since the single currency area was created is Germany.
Eurostat estimates that unemployment averages 9.1pc across the eurozone. Compare that with 7.7pc before the crash.
Yet the number of under-25s who remain jobless is staggering. There are 3.7m youngsters without work in the EU28, 2.5m of whom are in the eurozone.
The sheer scale of the numbers for those without work in the southern countries is so horrifying they scarcely bear repeating but here goes: 45.5pc in Greece, 39pc in Spain and 35pc in Italy.
It’s a decade since the crash yet the number of the young unemployed is rising rather than falling.
Put bluntly, this means there is now a second lost generation of 15-to-24-year-olds finding themselves without work.
This is a tragedy of epic proportions, one that could be solved if Europe’s leaders took their own problems as seriously as they take punishing their friends across the Channel.
They might even learn a few lessons.
Fire and fury
STOCK markets were on the edge last night on rumours that top White House economic adviser Gary Cohn was about to resign in fury over President Trump’s response to the Charlottesville protestors.
Cohn, who is Jewish and a Democrat, is said to be disgusted by Trump’s comments on the rioting by white nationalists chanting anti-semitic slogans.
It was Trump’s attempt to blame both sides for the violence that has drawn widespread condemnation, prompting the president’s entire board of business advisers to step down.
Yet Trump needs Cohn – he is one of his biggest cards. The former Goldman Sachs president is in charge of his much-promised tax reforms and other pro-growth plans.
If Cohn, who heads the national Economic Council, were to step away, some say the markets would crash.
Cohn is also a trade dove when it comes to Trump’s economic war with China, one being waged single-handedly, it seems, by Steve Bannon, Trump’s chief strategist.
In an extraordinary interview released yesterday, Bannon admits he would like to see Cohn – and other rivals – neutralised: ‘They are wetting themselves,’ he said. But Bannon’s job is also on the edge.
Who knows, if Cohn survives, he might end up with even more clout.