April 26 (Bloomberg) -- Francois Hollande, the Socialist frontrunner in France’s presidential race, pledged to block corporate job cuts that may start soon after the May 6 vote.
Companies such as Peugeot SA have announced plans to cut thousands of job in the months ahead. Others have held off unveiling restructuring projects until after the election, Hollande said. Last month, French telecommunications regulator Arcep said phone companies may eliminate as many as 10,000 jobs to cut spending as they adapt to increased competition from Iliad SA’s new mobile service.
“I won’t allow a parade of firings that have been postponed,” he said on France 2 television yesterday. “There needs to be a sense of responsibility in executive suites at companies. The day after the election, before irrevocable decisions are taken, I will have to intervene.”
France’s jobless rate is at a 12-year high, with 2.9 million people out of work. That has prompted Hollande and President Nicolas Sarkozy to tour several distressed factories, promising they’ll do whatever it takes to prevent job losses.
Hollande has led Sarkozy in all run-off polls published since the April 22 first round he won. Ifop’s daily tracking for Paris Match magazine poll showed yesterday he may win 55 percent of the votes on May 6 against 45 percent for Sarkozy.
“Hollande may have pledged to protect these jobs, but his position will be very difficult to maintain,” Pierre-Yves Gauthier of Alphavalue SAS in Paris said in a Bloomberg Television interview on April 19. “It’s a political stand before the election, then business takes over.”
Employment ranks first in French voters’ concerns, a Viavoice poll for Les Echos daily showed March 28 as 52 percent of the respondents questioned said it should be a priority for a presidential candidate.
Hollande, who said last year that he would deter profitable companies from cutting jobs, has watered down his stance in recent months. He said in a letter to the lawyers for a social rights association that the current legislation for jobs cuts wouldn’t be modified. Hollande’s proposals include an obligation for profit-making companies who want to close their business to find an investor to take over the business and the jobs.
The flood of job cuts Hollande sees stem from restructurings companies have announced.
Air France-KLM’s restructuring plan has studiously avoided mentioning job cuts, although unions say there will be reductions. Vivendi SA may eliminate hundreds of marketing and administrative positions to offset a projected slump in earnings as its phone unit SFR competes with Iliad, unions said.
Finance Minister Francois Baroin said at the end of the year that there would be no firings at companies in which the government has a stake. That came after unions at nuclear reactor builder Areva SA leaked a plan for job cuts.
Sarkozy has scrambled to find buyers for distressed companies that were threatening to throw more people out of work. For example, his government brokered a deal to get LVMH Moet Hennessy Louis Vuitton SA to buy parts of lingerie maker Lejaby.
His Industry Minister Eric Besson said he will meet on April 30 with unions of Technicolor SA, the French producer of film-making products and technology, that’s looking to get rid of its unprofitable factory in Angers.
His office also said today that it’s working on trying to save 5,000 jobs at Neo Security after the security company said it may be forced to shut down and file for bankruptcy.
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