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FR: ILO Unemployment Rate
| Consensus | Consensus Range | Actual | Previous | |
| Rate | 7.5% | 7.5% to 7.7% | 7.7% | 7.5% |
Highlights
The unemployment rate for metropolitan France rose to a seasonally adjusted 7.7 percent in the fourth quarter, from 7.5 percent in the third to reach its highest level since the first quarter of 2021. The Full Employment Act which has been in effect for a year, had a modest contribution to the unemployment rate.
Youth unemployment remains a pressing issue, having risen in the fourth quarter to 21.5 percent against 19.1 percent in the third quarter, which is 2.8 percentage points higher than the comparable year-ago period. That is the highest unemployment rate since the first quarter of 2020.
Full-time employment was 57.5 percent in the last three months of the year, down from 57.6 percent the previous quarter, while part-time employment was steady at 11.8 percent of the workforce. Overall, full-time equivalent employment slipped to 64.5 from 64.6 in the third quarter.
The percentage of temporary workers increased to 1.3 percent in the fourth quarter from 1.2 percent in the third. This trend confirms anecdotal reports that firms are tending to replace expiring contracts with temporary ones.
Inactive people, defined as those wanting a job but not being considered due to not seeking work or being unavailable was stable during the fourth quarter. This halo around unemployment was 1.9 million people.
The labor market continues to struggle, and there are no indications that things will improve over the coming quarter. Lack of demand in the manufacturing sector is keeping firms cautious. If anything, they will likely revert to temporary contracts if they need extra manpower.
Market Consensus Before Announcement
No change expected in the jobless rate at 7.5 percent, not a pretty picture.
Definition
The unemployment rate measures the number of unemployed as a percentage of the labour force. It is based on the International Labour Organization (ILO) 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 report contains data on both total joblessness and just mainland unemployment; the latter is regarded as the more significant.
Description
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.
Despite the delay in publication of these data, investors can sense the degree of tightness in the jobs market. If labour markets are tight, investors will be alert to possible inflationary pressures that could exist. If wage inflation threatens, it is a reasonable bet that interest rates will rise and bond and stock prices will fall.