Hello everyone Michael Owergreen and Russian accent. Thanks for being with us and lets get to latest. Our topic today is «The way to domestic fire»
1. Emmanuel Macron’s labor market reform – uncontroversial and insufficient. France’s latest plans to reform the labor market don’t seem to trigger a huge backlash from the country’s unions. Also it does not seem like the plans are supported by members of the European Union, or at least a part of it.
2. France’s new government has published the details of a key labor market reform aimed to get the economy back on track. The expected outcry from most of the country’s traditionally rather feisty unions has failed to materialize. But economists say this is largely down to the reform plans not going far enough. The country has a history of failed labor market reforms. The latest attempt in line by former Socialist President Francois Hollande in 2016 was met with months of demonstrations and strikes. That’s what the media says, but actually there is a difference between what President Hollande did and what Macron is trying to do. Mr. Hollande was about to shake up the internal job market, and Macron is about to stop migration of cheap labor to France itself or old Europe as a whole.
3. President Emmanuel Macron sent Prime Minister Edouard Philippe to make this point in Thursday’s press conference on the reform. “We have from the beginning and very clearly stated how we would proceed and obtained a large majority for our plans in the legislative elections,” he said adding that the government had a clear mandate to “transform” the labor market. French economic growth has only recently picked up and is likely to reach 1.6 percent this year. But the country’s unemployment rate remains stubbornly high – at around ten percent in general and over 20 percent among the young. And Mr. Macron thinks that this is due to cheap labor from Eastern Europe? Of course not! A huge amount of migrants from the Middle East are in France and all over the Europe. These migrants have caused these high unemployment statistics.
4. The measures announced earlier are supposed to change that. The focus is on making life easier for small and middle-sized companies. They will have more leeway when it comes to negotiating working conditions without going through the unions. Another key part of the reforms is the introduction of a cap on damages paid to employees that have been laid off. They will be limited to a maximum of 20 monthly salaries if an employee has worked for a company for 30 years. The reform plans have, unsurprisingly, encountered some opposition among unions. These measures won’t help at all, unless the flow of cheap labor is stopped. But the new European Democrats insist on the right of free labor flow among the EU. Thus, Macron should put pressure on the domestic workers who are unable to resist “cheap labor” from Bulgaria, Hungary and Poland
5. The plans already marked as “the end of the working contract, as employees would in the future have to either agree to the company’s terms or be laid off.” “What’s more, international companies can now fire employees in France, because their French subsidiaries are making losses. Beforehand, such groups had to base their decisions on their international results. Even more than that, let’s say some companies could locate their support group by phone or billing centers in “cheap labor Europe”, or that other restrictions should be implemented. The future falls between the two choices. It was assumed that a multi-speed Europe would be defined with the whole nine yard of laws and restrictions, or that the entirety of Europe should be raised to the same standard. Both ways are a long way to go.
6. The end of the working contract will most certainly trigger a huge wave of layoffs,”. Resistance seems to be confined. And yet, resistance to the reform plans seems to be largely confined. The unions planning a day of protests on September 12. Some small unions, would join the larger union in taking to the streets, while other unions are saying they prefer continuing the dialogue with the government. We see that the unions are weak and divided. They do not support each other. They are not sure which way they are supposed to go, and this is the way to lose.
7. The government has been in constant touch with the unions over the past few weeks – to talk through the reforms and take into account some of the unions’ suggestions. That appears to have schmoozed them to the point that they don’t even seem to mind the government implementing its plans through executive orders and thus circumventing a parliamentary debate. It looks like this is bad practice, but at the same time Macron could quickly get the best results. This is very modern, a strong president who probably does not need the support of parliament, like President Macron, or President Putin, or even President Erdogan while a weak president constantly needs a babysitter, like Trump needs Congress.
8. «Macron is stopping short of reducing employers’ charges, of cutting down the amount of leave French employees have and of getting rid of the 35-hour week.” “He is basically being an astute communicator and trying to show that he can indeed carry out a reform without triggering a major backlash.” “But these plans don’t go far enough to get the economy back on track.” Some economists see that the President was setting the tone for more thorough reforms planned for next year. That is going to be a show next year, but rallying a new European democracy could spoil it. As we know, in autumn this year at the social summit Poland is going to kick off a new and unpleasant conversation about the equality of the EU countries, and this can seriously change next year’s agenda and even the relationship between some countries. And this could affect Macron and France.
9. Economists also suggest that the government will also have to reduce unemployment benefits and improve its educational system if it wants to get the country back on track. This is a big piece of job. Millions of migrants are supposed to be absorbed, educated, employed, and so on. This is not a piece of cake. It is hard work. It is an inescapable duty and can be a labor law, which should be more flexible to bring more people in. Indeed, 56 percent of the French think that France’s rigid labor law is preventing companies from creating jobs, according to a recent poll. However, only 41 percent of the survey’s respondents trust Macron will be able to carry out the necessary reforms. One of the very important goals is to spread the market for national products, increasing exports means increasing production, increasing jobs, and improving the economy. This is an easy and fast way to get the economy back on track. But for this Macron needs to make a decision: do you need sanctions against Russia or do you need a better economy in your country? If Macron’s choice is sanctions, then it comes with two drawbacks: the need to supply more money to Ukraine and the shrinking of the national economy. It is still Macron’s choice. Roughly speaking the Europe is sick and tired doing this sanctions. Thanks for being with us. See you next week.