Vive la difference

For a man who continually insists that Labour don’t have a plan, Jeremy Hunt seems to know quite a bit about what Keir Starmer would do in office.
Last week, before Rishi Sunak’s bombshell election announcement, the chancellor under whom the tax burden will rise to its highest level in over 70 years announced that under Starmer, taxes would go up even further.
And he also claimed that Labour is plotting to introduce “a French-style labour market where unemployment is nearly double what it is in the UK” – although I didn’t see that on Starmer’s pledge card.

All governments pick and choose which neighbours and rivals they want to compare themselves to, based on the statistics that show their own performance in the best light. It used to be, for example, that you look at growth and say Britain was soaring ahead of Italy – although even that straw to clutch at is now beyond our grasp.

Hunt feels he is on safer ground with France and unemployment. But the fact is, we should be looking at the French with envy rather than pity and disdain.

For a start, the average French person is 10% wealthier than the average Brit. I’d like to be 10% better off, and I am sure the chancellor would too.

The reason for that is that French workers are about 20% more productive than British ones. The average French worker could work Monday to Thursday, enjoy a three-day weekend every week and still produce as much as we do. It’s because while we’re largely dependent on unskilled workers working long hours to make up for a lack of investment in our businesses, the French have a highly-educated, highly-skilled workforce.

A lot of France’s unemployment is actually made up of people who are paid to stay at home because they aren’t educated or skilled enough to get the jobs available. That is a permanent problem for the French – but then low-skilled, unproductive workers are a permanent problem for the UK.

What about the benefits the unemployed French receive? Here there seems to be a permanent government competition to see who can be nastiest to the poorest, who are classed as scrounging layabouts milking it.

This is a load of merde. The UK has one of the least generous benefits systems going and our Job Seekers Allowance in the UK is not only the lowest unemployment benefit among similar rich countries, it is just about the worst in Europe.

After several months on benefits, the average unemployed person in the UK gets just 17% of their previous wages in benefits. In France, the figure is 66%. That’s not even the most generous in Europe – in Luxembourg it is 85% and in Denmark, 78%. But here, the unemployed fall into poverty almost immediately and they stay there.

In-work benefits in the UK also compare badly with those in France. By law, the working week there is 35 hours. If you do extra, you get paid overtime.

The French get five weeks’ paid holiday per year, plus 11 public holidays – pretty much the same as us.

The UK has just about the worst paternity leave system in Europe – one or two weeks’ leave, taken at once, for which you get paid a maximum of £184.03 a week, before tax. We have Europe’s third-worst maternity leave system – in the first six weeks you are paid 90% of your normal wages; after that it is that maximum of £184.03 again. In France, parents get a maximum of £846 a week. The French have a right to 16 weeks’ maternity leave, with up to 10 additional weeks for multiple or difficult births. Paternity leave is 25 days, or 32 days for multiple births.

All of this and many other factors like luncheon vouchers, help with the cost of commuting and many others mean that workers in France are better off than the average UK worker and the unemployed are far better off.

This is not to say France does not have its problems. Its employment rate is even lower than the UK’s at 68.4% compared to 75%, although a lot of that may be because in France many families can survive or even prosper with just one adult in work. In the UK it is normally necessary for both to hold down jobs to survive.

France’s unemployment rate is also stubbornly high at over 7%, twice the UK level. Without improving the education and skills of that portion of the population, the unemployment level is likely to stay high.

But it is also fair to point out that the UK has the highest percentage of people with disabilities in Europe. Despite having more or less the same population, we have 2 million more people on disability allowances than France does, or an extra 4% of the workforce. This suggests that many people have been pushed off unemployment benefits and onto sickness and disability benefits, an old statistical trick that keeps the unemployment figures looking better than they really are.

Research in 2022 by Sheffield Hallam University looked into this issue and estimated that the “real level of unemployment across Great Britain as a whole was just over 2.3 million”. At the time the government’s Labour Force Survey was saying that only 1.31 million people were out of work. The report estimated “that there are some 790,000 ‘hidden unemployed’ on incapacity benefits” alone. That suggests very strongly that the real level of unemployment in the UK is actually around 7%, so pretty much the same as in France.

The chancellor should be more careful in his criticisms of Labour’s French connection. There are many things we could import from across La Manche that would make a real difference to the UK: Better benefits to keep the unemployed out of poverty, better healthcare to get the ill back to work, better maternity leave and childcare facilities to encourage more women into the workplace.

But no, you just can’t recreate the French labour market in the UK. Quel dommage, because in many ways it is better than our own.