FR: ILO Unemployment Rate

Thu Mar 05 00:30:00 CST 2015

Consensus Actual Previous
Level 9.9% 10.0% 9.9%

The ILO measure of unemployment showed a 0.1 percentage point gain to a 10.0 percent rate in metropolitan France last quarter. The increase reflected a 36,000 advance in the number of people out of work which now stands at 2.988 million, a new record high. Including overseas territories the rate was 10.4 percent, also a tick higher than the third quarter's slightly lower revised 10.3 percent mark.

The rise in metropolitan joblessness was dominated by 15-24 year olds and, while short of the third quarter's 79,000 jump, was still the sharpest since the first quarter of 2013. The latest PMI surveys have been rather more optimistic about the current quarter and improving consumer confidence - February saw its highest level since May 2012 also supports a potentially stronger jobs market.

Still, for now the risk remains that worries about job prospects restrict household spending and dampen the economy's recent apparent pick-up in momentum.

The unemployment rate measures the number of unemployed as a percentage of the labor force. It is based on the International Labor Organization definition of unemployment, which excludes jobseekers that did any work during the month and covers those people who are looking for work and are available for work.

The data report the number of unemployed persons (quarterly average) for metropolitan France and for metropolitan France plus overseas departments. The metropolitan measure is regarded as the more useful guide.

The data provide a comprehensive report on how many people are looking for jobs and the unemployment rate. These numbers are the best way to gauge the current state as well as the future direction of the economy. Analysts in France and Europe tend to focus on the number of French out of work rather than the unemployment rate as we do in the U.S.

Despite the delay in publication of these data, investors can sense the degree of tightness in the job market. If labor markets are tight, investors will be alert to possible inflationary pressures that could exist. If wage inflation threatens, it's a good bet that interest rates will rise; bond and stock prices will fall.