Competitive employment tax credit is the subject of a new report from France Stratégie. These measures, which was in effect from 2013 to 2019, was it effective? Ok …
What is the CICE?
The Tax Credit for Competitiveness and Employment (CICE) is a state aid to businesses, amounting to around twenty billion euros per year. In force from 2013 to 2019, the system has been replaced by a reduction in employer contributions. It is still a question of financial support for companies, but it is immediate, whereas the CICE was paid with a delay of one year.
Why are we talking about it again?
The brutal announcement of the closure of the Bridgestone plant in Béthune again raises the question of the relevance of public aid to businesses. In addition, the publication, Thursday, September 17, of a report from France Strategy, a research institute dependent on the Prime Minister, sheds new light on the CICE.
What does this report say?
100,000 to 160,000 jobs were created or preserved thanks to the CICE from 2013 to 2017. This corresponds to a fall in unemployment of 0.3 to 0.5 points ”,
calculates Bruno Ducoudré, economist at OFCE, a research center that participated in the study. It should be remembered that the unemployment rate in metropolitan France fell from 10% at the start of 2015 to 7.9% at the end of 2019. That is to say a drop of 2.1 points on which the CICE therefore had a limited effect. The CICE has not made it possible to massively reduce unemployment,
summarizes Éric Heyer, director of the analysis and forecasting department of the OFCE. But the record is not so bad.
Was the CICE money only used to hire?
It depends on the sectors. Job creation took place more in services,
continues Éric Heyer. Rather, the industry used the CICE to restore its margins: this could take the form of lower product prices, investment in research and development, etc.
Is it a rational device with regard to its cost?
From 2013 to 2016, the CICE cost the State nearly 67 billion euros. Or an amount of approximately € 500,000 per job created. The cost is lower,
tempers Bruno Ducoudré. To calculate it, it would be necessary to subtract the unemployment benefits saved by these job creations or even the social contributions and taxes generated. Not to mention the wealth created.
The objective of the CICE was not reduced has an immediate effect on employment “,
adds the France Strategy report. It also concerned energy transition, innovation …
So many induced effects that remain to be measured.
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