Employment Protection

Politics, The Economy

At the heart of France’s protests are efforts to reform the labor market. In light of that it is worth reading this article by Mark Weisbrot:

The government claims that employers will hire more people if it is easier to get rid of them, and that therefore unemployment (especially among younger workers) will be reduced. But the available economic research provides little or no evidence for this argument.

For example, there is no relationship between the amount of employment protection in different countries and their unemployment rate. This is true generally for measures often portrayed as having as having a negative impact on employment: for example, unemployment compensation, national collective bargaining, or the percentage of union members. While it is true that France’s unemployment rate is relatively high (9.2 percent), there are a number of countries with high levels of labor market protections and low levels of unemployment: Austria (5.2 percent), Denmark (4.4 percent), Ireland (4.3 percent), the Netherlands (4.6 percent), and Norway (4.5 percent).

How inconvenient for the folks at the Economist

(via MaxSpeak)

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