What accounts for the today's difference in unemployment rates between France and US?
France has one of the highest unemployment rates out of the industrialized nations. It has been at around 10% for the last two decades. Many French workers will go through unemployment at some point in their career, and it is an especially high probability for the low skilled workers and the young. There are many possible reasons for why France has a much higher unemployment rate than the US and different groups have different interpretations. Some say it's because of differences in levels of economic performance, others that it is because the government has spend so much on getting the economy ready for Europe's single currency, that there is no money for jobs. More realistically though, it is because the French government excessively regulates the labor market which tends to make it very rigid. The government with its legislation directly and indirectly limits firms in their hiring and it protects the employed rather than the unemployed.
A comparison of the evolution of the data for unemployment in US and France shows an overwhelming difference in the unemployment rates between the two countries. In the last few years, the same way it has been in the last two decades, the rate of unemployment in the US has been far inferior to the rate of France. The average standardized rate of unemployment for the period of 1996 to 2002 for France is 10.6% whereas it is 4.8% for the US (www.oecd.org).
However, the rate of unemployment in the US increased from 4.2% in 1999 to 5.8% in 2002 while it decreased from 11.2% to 8.7% in France during the same period. But the downward trend of France's unemployment rate switched around as France saw its rate increase from 9% in last seme ...