Aided contracts, a drop in the ocean of unemployment

INFOGRAPHIC – Since his election, François Hollande has massively resorted to subsidized contracts, without succeeding in reversing the unemployment curve. Monday, after the publication of unemployment figures, François Rebsamen again promised 100,000 additional subsidized jobs. But these will not take effect immediately.

breaks the piggy bank again in an attempt to reverse the unemployment curve. Monday, after the publication of figures for the month of May, marked by a sharp increase in the number of job seekers, the Minister of Labor, announced the creation of 100,000 additional subsidized jobs.

Since the start of his five-year term, the Head of State has relied heavily on the lever of subsidized jobs to fight unemployment. 150,000 jobs of the future, promised during the presidential campaign and especially intended for young people under 25 who left school without or with few diplomas, were to be signed by the end of 2014. A quantitative objective finally fulfilled, this which was not the case for generation contracts, another presidential promise on the employment front. These contracts, this time intended for the private sector and which do not appear strictly speaking in the quota of subsidized contracts as recorded by INSEE, have indeed clearly. While François Hollande wanted to sign 500,000 during his five-year term, only 40,000 were signed in 2013 and 2014 …

Short term strategy

Most of the assisted contracts signed under François Hollande were in fact finally in the public sector and associations. Of the 112,000 jobs of the future identified by INSEE at the end of 2014, nearly 90,000 were in the non-profit sector against only 23,000 in the private sector. In fact, these actors are much more easily mobilized than companies… which is interesting in reducing unemployment in the short term – this is generally the objective of governments when they resort to subsidized contracts.

However, studies carried out on the subject show that it is rather the subsidized jobs signed in the commercial sector that ensure the best employment prospects for their beneficiaries. “The two objectives can be contradictory”, regrets the Court of Auditors. In the non-profit sector, less than half of the beneficiaries of a subsidized job have a job at the end of their contract …

100,000 additional assisted contracts

In 2014, however, France had 331,000 beneficiaries of assisted contracts in the non-profit sector and 59,000 in the commercial sector (excluding work-study training and generation contracts). The finance law for 2015 still provides for a large pool of assisted jobs for this year, while waiting for the recovery to finally have repercussions on the job market: before the 100,000 new contracts announced by François Rebsamen yesterday, 320,000 had to be signed in the non-profit sector. Above all, they will serve as a relay for contracts that are about to expire. In total, the number of beneficiaries of contracts assisted in the public sector and associations was in fact only to grow by 20,000 over the first six months of the year.

VIDEO – Reactions to the creation of 100,000 additional subsidized jobs.