World leaders must pay attention to 3-speed economy to reverse unemployment trends, say experts
The rising French unemployment figure topped out at 10.8% in the first quarter of 2013, the highest it has been since 1998, according to data released from the national statistics institute Insee.
The jobless rate has risen from 10.5%, in the last quarter of 2012, and the French economy also went into a recession after seeing GDP fall by 0.2% in the first quarter
Tom Bewick, Chief Economist at the International Skills Standards Organisation, said, “There are lots of internal issues that France needs to grapple with. It needs to reform its labour laws so that its labour market is far more efficient.”
According to Tom, the only way that global governments can tackle the rising unemployment found in many countries is to recognise the ‘3-speed economy’ that has materialised. This consists of the emerging market BRIC countries (Brazil, Russia, India and China); the countries in the ‘second tier’ of global growth such as France and the UK; and countries such as Spain and Greece that find themselves in an economic depression with shrinking economies. France currently finds itself in a position where growth is anaemic and stagnating.
A fresh perspective is required from policymakers, according to Tom, to get to grips with the changing global markets.
He said, “Countries must pay attention to structural reforms in their labour markets as a first priority. They must look at where there are skills mismatches and imbalances. They also need to identify the stumbling blocks in employment in order to achieve higher rates of growth and competiveness.
“A renewed focus on innovation is crucial on a global scale, particularly in countries aiming to claw their way back into sustainable levels of growth. Even where countries are cutting their budgets through austerity they should be increasing their budgets for research and development and looking again at the ecosystem that they put around business start ups and business growth in general.”
Tom concluded, “In an increasingly global marketplace, countries must focus on trade. France and the UK have poor records in terms of trading with emerging countries and the repercussions of this are manifesting themselves. It’s all about a fresh focus on emerging markets which are the new middle class of consumers that exist in this part of the world.”