那提西-法国-宏观经济-法国：应该启动双重良性循环-20180129-9页_565kb

Flash Economics: France's Structural Challenges and Solutions

Core Content

The document discusses two major structural problems in France that hinder its economic performance and growth potential. It emphasizes the need for a twofold virtuous cycle to address these issues effectively.

France's Two Major Structural Problems

1. High Structural Unemployment Rate

   • France's structural unemployment rate is abnormally high, contributing to a significant portion of its economic challenges.
   • This is linked to low employability among young French people, as shown in Chart 4.
   • The high unemployment rate suggests that growth in demand and cyclical upturns are not sufficient to reduce the structural unemployment, which has weakened the potential GDP level.

2. High Tax Burden

   • France has a very high tax burden, particularly corporate social contributions, which is another critical structural issue.
   • This high tax burden reduces labor demand and increases structural unemployment, especially for low-skilled workers.
   • The tax burden is highlighted in Chart 3A, with corporate social contributions shown in Chart 3B.

Key Solutions: A Twofold Virtuous Cycle

1. Improvement in the Efficiency of the Education System

• France's education system is inefficient, as evidenced by PISA surveys (Table 2) and performance in mathematics and reading comprehension (Tables 3 and 4).
• Enhancing the education system is crucial for improving youth skills and reducing structural unemployment.
• However, according to the document, this improvement has not yet begun.

2. Increase in Employment Rate of the 55-64 Age Group

• The employment rate of the 55-64 age group has increased since 2009, indicating some progress.
• Specifically, the 60-64 age group's employment rate remains significantly lower than in other OECD countries, as shown in Table 5.
• This increase can lead to a higher potential GDP level and reduce government spending on pensions, thereby lowering the overall tax burden.

Main Points and Findings

• Chart 1 shows France's unemployment rate at an abnormally high level.
• Chart 2 highlights recruitment difficulties across various sectors in France.
• Chart 3A and 3B illustrate the high tax burden, especially corporate social contributions, in France.
• Chart 4 demonstrates the low employability of young French people.
• Chart 5 indicates an increase in the overall employment rate and participation rate.
• Chart 6 shows the high level of pension spending in France.
• The document concludes that while one virtuous cycle (employment rate of the 55-64 age group) has started, the other (education system efficiency) has not.

Conclusion

• France needs to initiate both virtuous cycles to address its structural issues.
• Only the second cycle (employment rate of the 55-64 age group) is currently underway.
• The first cycle (education system improvement) is still pending and needs to be prioritized.

Disclaimer Highlights

• The document is intended for professionals and qualified investors.
• It is confidential and not to be disclosed without prior consent.
• It does not constitute a financial analysis or investment recommendation.
• Natixis disclaims liability for any actions based on the document.
• The information is based on public data and may be subject to change.
• No responsibility is accepted for the accuracy or completeness of the information.
• The document is subject to regulatory requirements in various jurisdictions.