ORIGINAL FRENCH ARTICLE: L’Insee prévoit une courbe du chômage en hausse en 2013
by Clotilde Mathieu
Translated Monday 24 June 2013, by
The INSEE is announcing negative growth of minus 0.1% and a jobless rate of 11.1%. This forecast contradicts the scenario of a “reversal of the [unemployment] curve” defended by President François Hollande on June 20.
The INSEE is decidedly not coming to François Hollande’s rescue. Unemployment, “although at a reduced rate” “should continue to increase to the end of 2013,” the statistical bureau forecasts in its note on the economic situation. The announced goal of reversing the unemployment curve by the end of the year seems unattainable. With an active population that is still very dynamic, despite the retirement of the first generations of baby boomers and the decline in the number of jobs, with a loss of 32,000 jobs in 2013, the unemployment rate is likely to be 11.1% at the end of 2013.
Not one ray of sunshine
In the market, or commercial, sector, 113,000 jobs will be shed, with losses in industry, the tertiary sector and the building trades due to “the weakness of activity,” the INSEE explains. Its analysts admit having been surprised by a fall in activity in the first quarter, whereas the forecasts were for stable activity. There is not one ray of sunshine amid the gray clouds of the economic crisis in the coming six months – while negative growth should cease, it will remain nil (0% and 0.1% in the last two quarters). This will not be enough to prevent negative change in growth over the year as a whole.
In the end, gross domestic product will fall by 0.1% over the year, essentially due to falling consumption and the collapse of investment, down 2.6% over the year, beginning with company investment which should fall by 2.4%. With no prospects, bosses are delaying their investments till later. With a sharp decline in their purchasing power in 2012 (down 0.9%), lagging pay rises – for civil servants, wages have even been frozen – the French have “adapted” their consumer expenses, the INSEE explains, to such a degree that they will decline by 0.1% over the year. Only exports are slightly upbeat, while nonetheless remaining far below their 2012 contribution to growth (up 0.8% in 2013, as against 2.5% in 2012).