France to clamp down on layoffs
Keeping up with unemployment is a bitch, but somehow, everybody seems to have their own way of handling it. Take Iceland for instance, after letting their banks fail, they devalued the Krona, slapped on harsh capital controls, and saw their unemployment rate drop to 5.6%. Germany meanwhile slashed wages across the board, raised their retirement age to force people back to work, and saw theirs drop for 27 straight months to 6.7%.
Germany's work-shy neighbors to the southwest however, seem to handle things a little differently:
France's new Socialist government is planning to ramp up the cost of laying off workers for companies in the coming months, its labour minister said on Thursday after data showed the jobless rate hit the highest level this century at 10 percent."The main idea is to make layoffs so expensive for companies that it's not worth it," Sapin said in an interview with France Info radio.
"It's not a question of sanctions, but workers have to have compensation at the right level," he said.
Industry Minister Arnaud Montebourg is also planning legislation that would force companies to sell plants they want to get rid of at market prices to avoid closures and job losses.
Okay, am I the only one here who thinks this is the dumbest thing ever?
To say that this proposal would do more harm than good is a spectacular understatement. Not only will this policy bar the unemployed from getting jobs, it could easily force companies to layoff everybody else while they still can. Where would they go to next? Small businesses and start-ups? They won’t be hiring either, ‘cause when things go south, those guys could easily go broke under this regime. How do you think that'll affect their economy?
Oh, and don’t get me started on this little gem:
Industry Minister Arnaud Montebourg is also planning legislation that would force companies to sell plants they want to get rid off at market prices to avoid closures and job losses.
What do you think monkeys? Am I totally wrong here? Does Hollande really know best? I remember somebody here say that while it might look ridiculous to us, the French model really works for them, so I'm curious what you guys here have to say about this. Does that apply here at all? How would you deal with France's unemployment anyway?
Enjoy your weekend monkeys.
frogs
It's socialism, what did you expect? Obviously they aren't going to go about things in a manner which you think normal and appropriate. We are capitalists, they are socialists, and this is a great example of the differences in ideology between the two forms of government. Obviously you are not totally wrong here. This is a ridiculous solution to a problem designed to compensate everyone regardless of their intrinsic value. There's plenty more crazy ideas to come from the French government. If I were you, I wouldn't worry about it unless you are from France.
Seems like a lot of bankruptcies will be on the horizon in France.
While making layoffs more expensive will not have the effects that are desired (reducing unemployment), France's unemployment rate has a lot more to do with their national fiscal policy in light of a EuroZone single currency system and monetary policy than the finer details of ease of laying people off.
Yeah, because price controls always work the way they're supposed to.
France already has ridiculously high barriers to lay-offs, so I struggle to imagine how they can make it worse.
The result of this sort of thing is always that's firms are more hesitant to hire more workers, and lots of people end up in permanent part-time employment. It's an insider/outsider system that is ravaging much of Europe's youth.
I had hoped the new regime would be "socialist" in name only...well, so much for optimism.
If I were a company executive in France, I'd be firing people right and left right now. And why would you hire more workers if they are going to bleed your company dry if things go south.
Now that the socialists won the majority in parliamentary elections, expect a lot more of such stupid decisions in France...
The European system is great for the old folks and absolutely awful for anyone under their 30s or 40s, they are going to destroy their country
I can tell you guys first hand that having French employees is a complete and utter nightmare. I have neither the time nor the inclination to get into it right now, but it's awful here. I would never start a company here. NEVER.
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