Mar 19, 2009

Twenty Somethings in the News: Thousands of young workers protest new labor proposal in France

Protests in France

Protesters are bitterly opposed to the new First Employment Contract (CPE), which allows employers to end job contracts for under-26s at any time during a two-year trial period without having to offer an explanation or give prior warning.

The government says it will encourage employers to hire young people but students fear it will erode job stability in a country where more than 20% of 18 to 25-year-olds are unemployed - more than twice the national average.

- BBC News

I find this very interesting. Youth unemployment rates in most places tends to be higher than that of the general population. (In America, for instance, youth unemployment rates tend to be a little more than twice as high as in the adult population.[1]) In France, however, the number is incredibly high, reported to be as high as 1 in 4 young people. I've read a number of reasons for why the youth unemployment rate is so high: high unemployment in general, a high minimum wage, longer stays in college (as some higher education in France is less expensive), and better long-term unemployment benefits (although as I've also read, you have to lose a job before you qualify for unemployment, so this has less influence over the youth population.)

The International Labor Organization shows that while youth unemployment rates in France are tied to adult unemployment rates, and often remain at proportionate rates (about 2:1), youth workers tend to be the most vulnerable in the labor market if the market goes south, as well as have greater movement both in to and out of the labor market, meaning the steady employment is not as common for young workers [2]. That being said, I find it odd that a bill that would simply make it easier to fire young workers and which would likely increase the number of young workers coming into and out of the job market would be proposed as a solution to high rates of youth unemployment, when these two things are already key factors in youth unemployment. I also find it odd that, considering France's overall unemployment is high, such a measure would not be extended to all laborers in the market. In my opinion, it's just making an already vulnerable demographic even more vulnerable.

I also think it's interesting many of the responses to the French youths' protests. I've noticed a lot of comments arguing that France's young people just don't want to work. I think this is an incorrect assumption. Most of the protesters' complaints tend to be centered on the fact that it will make it easier for them to be fired, and also easier to place them into "disposable" positions where cheap, inexperience labor could be easily brought in and then thrown out before being forced to give a better contract. It's being called the "kleenex contract" -- as soon as you're done with it, you throw it away and get a new one. I think the argument is that this would just introduce more instability in an already volatile market.

For me, the biggest hang up is the fact that these laws only apply to workers under the age of 26. If this were really such a great law to remedy unemployment, this would be applied to everyone, regardless of age. If this is, however, a way to put a very temporary band-aid on the unemployment problem, in hopes of creating a brief up-swing of hiring of young workers, in the long-term I think this will just create more problems for youth labor.

Any way you look at it, though, I'm glad this kind of inequality isn't being introduced into the market here. I think young workers already face enough challenges breaking into the labor market, what with lack of experience and often being the first to go in a round of lay-offs. Legislating incentives, however, for treating your young workers differently... I don't really care much for that.

Update: About five minutes after I posted this, I read the new Work Buzz post about unemployment in America. Awesome statistic of the day? 3.7 million people between the age of 16 and 29 are unemployed.

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