Unédic, which manages the unemployment insurance scheme, anticipates the destruction of 900,000 jobs at the end of 2020 compared to the 4th quarter of 2019, which would lead to compensation for 630,000 additional job seekers, she said. Thursday in a press release.
According to its forecasts, Unédic will register a deficit of 25.7 billion euros at the end of 2020, of an "unprecedented scale", and a debt of 63.1 billion (well billion). Half of this is linked to the funding of the partial unemployment scheme, and 29% to the increase in unemployment benefit expenditure and 19% to the deferral of contributions.
A sealed deficit
Unédic finances one third of the partial activity scheme, the rest being financed by the State. Debt had already climbed from 36.8 billion at the end of December 2019 to 42.6 billion as of April 23, due to the massive use of unemployment since the confinement in mid-March.
Since then, the unemployment insurance balance has deteriorated by 11.5 billion euros. To finance itself, Unédic had to issue two medium-term social bonds, which enabled it to raise “8 billion euros”.
Before the Covid-19 crisis, in February, Unédic expected a deficit of 0.9 billion and a return to the surplus from 2021. “Unemployment insurance is traditionally four times more affected in its finances by a crisis than other social protection schemes, which are only affected on the revenue side, ”recalls Unédic.
The debt issue
“The question of the sustainability of the debt in the medium and long term and its structure must be posed, just like the sustainability and the functioning of this device [of partial unemployment] which does not have revenues. It is up to the social partners and the government to decide, ”said Eric Le Jaouen, president of Unédic, quoted in the press release.
In 2020, unemployment insurance spending would increase by 17.7 billion euros, and "would be around 59 billion", an increase of 43% compared to 2019. Revenues from social contributions would be down by 16% compared to 2019, at 33 billion euros.
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- Society
- Coronavirus
- Unedic
- Confinement
- Unemployment