France’s unemployment rate climbed to the highest in almost 16 years in the third quarter as President Francois Hollande struggles to revive an economy that has barely grown in two years.
About 10.9 percent of the French workforce is out of a job, up from 10.8 percent in the second quarter, national statistics office Insee said today in an e-mailed statement. Excluding France’s overseas territories, the rate rose to 10.5 percent from 10.4 percent.
The increase puts unemployment at the highest since the end of 1997 and underlines Hollande’s challenge in reversing a rise in joblessness at a time when tax increases and lackluster economic growth are deterring companies from investing. Although jobless claims dropped in October amid the anemic recovery and government-created work, France’s rising population means that the unemployment rate is still climbing, economists said.
“The labor market is stabilizing, partly thanks to the economic recovery, partly thanks to subsidized jobs,” said Dominique Barbet, an economist at BNP Paribas in Paris. “People clearly perceive the situation of the labor market as much worse than what the data say it is.”
Insee said today that it will change its methodology for the calculation for the fourth-quarter statistics, due in March. Barbet estimates that the new method will result in a 0.3 percentage point downward revision in the unemployment rates.
“The numerous revisions in the methodology and the data which has occurred in the past eight years carry the risk of reducing the reliability of official figures,” Barbet said.