Margaux Fodéré / Photo credit: IGOR STEVANOVIC / SCIENCE PHOTO / IST / SCIENCE PHOTO LIBRARY VIA AFP 11:32 am, June 07, 2023

Presented to the Council of Ministers on Wednesday, the bill "for full employment" acts the creation of France Labour, successor of Pôle emploi. The executive wants to achieve full employment, i.e. an unemployment rate of around 5% in 2027. But what exactly does the term "full employment" mean?

The government presents this Wednesday its bill "for full employment", which should give birth to France Work, successor of Pôle emploi. Objective: to achieve full employment by the end of Emmanuel Macron's mandate. But what does "full employment" mean?

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An ideal level of employment in an economy

Achieving full employment does not mean that there will be no more unemployed. The term refers to an ideal level of employment in an economy. It is achieved when a maximum of candidates and companies agree on the skills required, the remuneration, or the geographical area of the position.

However, an economy without unemployment is not desirable

In France, full employment is around 5% unemployment. It is very difficult to be below this percentage, since there are always employees who leave their jobs, companies that go bankrupt and therefore, individuals without work.

While this may seem surprising, an economy without unemployment is undesirable and would even be dangerous. Because the rarer the candidates, the more companies increase salaries to attract them. The consequence, an overheating economy, the increase in prices, therefore the return of inflation.