Thursday, May 8, 2008

Chien Méchant

As I noticed on my last visit to France, you don't meet many Eastern Europeans here. Okay, there are a few Russians but they seem to keep themselves to themselves in well protected villas with chien méchant notices on the gates ...

Of course this is due to France's decision not to allow the recent waves of countries joining the EU access to its labour market. It does mean that you meet French people in every restaurant and shop you visit - in marked contrast to Ireland. You would also expect it to mean that France has a low unemployment rate (if that was the intention of their decision) but it doesn't. The latest Eurostat data shows France having the fourth highest unemployment rate of the EU 27 countries, as shown in the chart. Incredibly, youth unemployment (under 25s) is also very high in France (18.1%) despite the availability of the kind of low skilled, entry level jobs 'exclusively' for French people.

Ireland and the UK chose a different path - allowing the first wave of Eastern European entrants free access to our labour markets. Though the jury is still out on whether there has been a net benefit to the host countries (and will be for at least another turn through the business cycle I reckon) we do not seem to have suffered the high youth unemployment in particular that the French obviously feared. Nor are we likely to: I'm with Brendan Keenan in today's Irish Independent when he suggests that even if Irish unemployment goes as high as 8% in the next year or two we'll still have fared much better than expected given the scale of the global economy's problems.

Still, I can't help noticing that France's unemployment rate is going in the right direction (down from 8.6% in March 2007 to 7.8% in March 2008), whilst our's is going in the wrong direction: from 4.6% to 5.6% over the same period. There's no Irish demand for the economic equivalent of the chien méchant just yet vis-a-vis immigrants: but don't be surprised if it nevertheless surfaces as a major issue in the next general election as we get closer to a French level of unemployment.

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