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France’s Macron Wants to Pay People When they Quit

<p class&equals;"MsoNormal" style&equals;"text-align&colon; left&semi;" align&equals;"center">French President Emmanuel Macron is negotiating with businesses and labor unions as part of his plan to extend the country&rsquo&semi;s unemployment benefits to also include individuals who quit their jobs&period;&nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Unemployment payments currently are reserved for those who have been fired or laid-off&comma; but Macron believes that by extending the program to include those who leave an employer on their own&comma; it will foster economic growth&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;The president says he wants France to be at the vanguard of countries experimenting with ways to manage the global shift from traditional salaried employment to a more fluid job market defined by startups and the gig economy&period; His plan&mdash&semi;coupled with an overhaul of state-financed training&mdash&semi;aims to backstop workers so they can take the kinds of professional risks that Mr&period; Macron sees as fueling economic growth&comma;&rdquo&semi; writes the <em style&equals;"mso-bidi-font-style&colon; normal&semi;">Wall Street Journal&period;<&sol;em><&sol;p>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;Society is changing&period; I&rsquo&semi;m not proposing to protect you against society or this change&semi; I am proposing to arm you to find a place in this society&comma;&rdquo&semi; said Macron last month&period; &nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Macron&rsquo&semi;s proposed unemployment system is similar to Denmark&rsquo&semi;s model&comma; where workers can get unemployment welfare even if they resign from a position or if they are self-employed&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">However&comma; Denmark&rsquo&semi;s model has strict procedures in place to encourage those collecting the unemployment benefits to get back to work&period; &nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;The threat of sanction is very credible&nbsp&semi;and they really follow job-search efforts because they are being so generous&comma;&rdquo&semi; said St&eacute&semi;phane Carcillo&comma; OECD labor economist&period;&nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">France&comma; on the other hand&comma; is much more lenient when it comes to qualifying someone for unemployment and doesn&rsquo&semi;t spend as much time overseeing their job seeking efforts&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;Claimants spend an average of 10 months on the dole and receive around 72&percnt; of their previous salary or wage&period; Monthly checks can be as high as &euro&semi;6&comma;500 &lpar;&dollar;7&comma;675&rpar; after taxes&period; The U&period;S&period; committed about 0&period;4&percnt; of its gross domestic product to public unemployment spending in 2013&comma; the latest year for which the OECD has data&semi; the same year&comma; France spent just over 1&period;6&percnt;&comma;&rdquo&semi; writes the <em style&equals;"mso-bidi-font-style&colon; normal&semi;">Wall Street Journal&period; <&sol;em><&sol;p>&NewLine;<p class&equals;"MsoNormal">Macron&rsquo&semi;s proposal is expected to increase the unemployment rate&comma; which recently rose to 9&period;7&percnt;&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">The French President has said that he would make the monitoring unemployment enrollees stricter&comma; but critics of the unemployment expansion argue that this would still encourage more to freeload on the system&period;<&sol;p>&NewLine;<blockquote>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;Standing in Mr&period; Macron&rsquo&semi;s way is a rare coalition of business leaders and France&rsquo&semi;s hidebound labor unions&comma; which have jointly managed the unemployment insurance system since its creation by President Charles de Gaulle in 1958&period; While the state guarantees part of the system&rsquo&semi;s debts and sets financial targets&comma; unions and business federations determine the rules and the size of checks&comma;&rdquo&semi; writes the <em style&equals;"mso-bidi-font-style&colon; normal&semi;">Wall Street Journal&period; <&sol;em>&ldquo&semi;Mr&period; Macron&rsquo&semi;s planned overhaul would change that&period; As the system transforms from an insurance policy just for workers into a safety net for all&comma; the government is set to wrest more control from unions&period; Mr&period; Macron&rsquo&semi;s government has already moved to slash payroll levies that directly finance the union-controlled unemployment program&period; The government says it will instead pay for the program with revenues from general taxation&period;&rdquo&semi;<&sol;p>&NewLine;<&sol;blockquote>&NewLine;<p class&equals;"MsoNormal">Macron&rsquo&semi;s controversial proposal will have to pass a vote in the National Assembly&comma; where he has a large majority&period;&nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">The majority of French citizens support the proposal&period; In a poll by the research firm Elabe&comma; 87&percnt; support unemployment payments for the self-employed and 74&percnt; for those who quit their jobs&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Macron gained support on his campaign trail by promising to improve apprenticeships&comma; job training and the unemployment-benefit system&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Barbershop owner J&eacute&semi;r&ocirc&semi;me Veneau voted for Macron in hopes that he could reform the labor market in France&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Veneau told the <em style&equals;"mso-bidi-font-style&colon; normal&semi;">Economist<&sol;em> that he has been unable to make a successful hire and the one time he did hire someone at his business&comma; it backed fired&period;&nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">&ldquo&semi;His customers are so plentiful that he regularly turns people away&period; Yet after 29 years&comma; he remains a solo practitioner&period; When he falls ill or takes lunch&comma; the shop closes&period; Why not hire someone to help&quest; &ldquo&semi;Never&comma; the whole system is a mess&comma;&rdquo&semi; he says&period; He once had an employee&comma; but the man claimed to have been injured by repetitive scissor-snipping&period; A court ordered Mr&period; Veneau to pay &euro&semi;17&comma;000 &lpar;&dollar;20&comma;000&rpar;&mdash&semi;some to the worker&comma; some to the state&period; His family stumped up the cash&period; &ldquo&semi;I&rsquo&semi;ll never hire again&comma;&rdquo&semi; he says&comma;&rdquo&semi; writes the <em style&equals;"mso-bidi-font-style&colon; normal&semi;">Economist&period;<&sol;em> &nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal">Veneau isn&rsquo&semi;t impressed with Macron&rsquo&semi;s current reforms and isn&rsquo&semi;t planning on taking the risk to hire again anytime soon&period;<&sol;p>&NewLine;<p class&equals;"MsoNormal"><strong style&equals;"mso-bidi-font-weight&colon; normal&semi;">Author&rsquo&semi;s note&colon;<&sol;strong> Macron&rsquo&semi;s plan to expand the unemployment welfare system will only incentivize people to not work&period; Not only will France have to pay millions more in unemployment checks&comma; the government will be forced to spend money on resources to monitor the unemployment collectors in an effort to motivate these individuals to re-enter the workforce&period;&nbsp&semi;<&sol;p>&NewLine;<p class&equals;"MsoNormal"><strong>Editor&&num;8217&semi;s note&colon;&nbsp&semi;<&sol;strong> Whatever you subsidize you get more of&period;&nbsp&semi; If you want lazy&comma; unemployed people&comma; this is a good way to train them to be that way&period;<&sol;p>&NewLine;

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