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Coronavirus. Unemployment rate set to ‘cross 10%’

The rate of unemployment in France, on a downward slope since mid-2015, is expected to cross upwards the symbolic threshold of 10% under the effect of the economic repercussions of the health crisis linked to the coronavirus, said Monday the Minister of Labor, Muriel Pénicaud.

While his colleague in Economy and Finance Bruno Le Maire now anticipates an 11% contraction in gross domestic product (GDP) this year, Muriel Pénicaud pointed out on BFM Business that it’s going to be hard also on the job market.

Without providing a precise forecast on the expected evolution of the unemployment rate, she declared thatin any case, we will pass the 10% and approved the abandonment of the government’s objective of an unemployment rate of 7% in 2022, rendered obsolete by the economic impact of the COVID-19 epidemic.

Three months ago, we had the green flashing lights to go towards 7%, well here we are moving away, observed Muriel Pénicaud, specifying that the job was going to be compass of the recovery plan in preparation. The unemployment rate in France has so far been on a decreasing trend since its peak at 10.5% in spring 2015.

A “trompe-l’oeil” drop

Unemployment rate calculated according to International Labor Office (ILO) standards fell in the first quarter trompe l’oeil, the containment introduced on March 17 in France modifying job-seeking behaviors and the availability of people, changing the statistics without reflecting a real improvement in the job market.

In the first quarter, the unemployment rate as defined by the ILO thus stood at 7.8% in France (Overseas department included, excluding Mayotte) and 7.6% in mainland France. Emmanuel Macron’s presidential program predicted that the unemployment rate would return to 7% in 2022, notably under the effect of the reform of labor law and the improvement of the competitiveness of businesses in connection with the reduction in taxation .

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