Latest news with #public holidays
The Guardian
2 days ago
- Business
- The Guardian
Two days less holiday? France is up in arms but my sympathy is limited
France is skint, but the French are in denial. To judge by the howls of outrage from the left and the hard right of the French political spectrum, you would think the prime minister, François Bayrou, had just taken a Javier Milei-style chainsaw to public services, announced Doge-style mass layoffs or imposed swingeing pay cuts. But it was Bayrou's suggestion that the French should give up two of their 11 cherished public holidays – Easter Monday and 8 May, the anniversary of the end of the second world war in Europe – and work instead to increase economic output and hence government revenue that provoked the anger. Jean-Luc Mélenchon, the leader of the hard-left France Unbowed (LFI) party, accused the centrist prime minister of leading a 'race towards an economic, financial and social abyss for the greater suffering of all'. The Socialist party leader, Olivier Faure, described the proposals as 'a demolition plan for our French model', and Jordan Bardella, president of the hard-right National Rally (RN), said the the proposal to cancel the two holidays was 'a direct attack on our history'. The hard left and the populist right threatened to bring down the government with no confidence motions in the autumn, when the budget will be put to a hung parliament, as they did with Bayrou's short-lived predecessor, Michel Barnier, last year. As is so often the case, the sound and fury in the echo chamber of French political rhetoric is out of all proportion to reality. Bayrou proposes a standstill in public sector pay, pensions, welfare benefits and tax thresholds in 2026, which, with inflation forecast to increase slightly to about 1.4% next year, means a modest erosion of living standards for most people and a slightly increased tax take. Better-off pensioners will pay more tax, poorer ones will pay less. The measures are supposed to reduce the deficit by €43.8bn to 4.6% of economic output next year. Only defence spending will be increased, in line with France's commitment to Nato, given Europe's deteriorating security situation. This is hardly a draconian austerity purge for a country that had a deficit of 5.8% of GDP last year – the highest in the euro area – and which by most rational measurements is living beyond its means. National debt has risen to 113% of GDP, higher than any EU country except Greece and Italy. But while their debt piles are falling, France's keeps on growing. Public spending accounts for 56.5% of GDP in France, the second highest level in the EU after Finland. Despite the centrist president Emmanuel Macron's intention to reduce the tax burden and get more French people into work when he took office in 2017, a series of crises – the revolt of the gilets jaunes against a carbon tax, the Covid-19 pandemic and the effects of Russia's war in Ukraine – triggered more state expenditure. In 2023, France's tax-to-GDP ratio was 43.8%, significantly higher than the average of 33.9% in advanced economies. The country has too many layers of public administration, which together employ 5.8 million people – 20% of the total workforce. Bayrou proposed that one in three retiring civil servants should not be replaced, drawing immediate protests from trade unions representing teachers, health workers and the police. Perhaps the most telling criticism came from Édouard Philippe, Macron's first prime minister and a likely centrist presidential candidate, who said Bayrou's package contained no structural reforms of failing public policies and was just an emergency plan to limit the damage without solving the problem. Sign up to This is Europe The most pressing stories and debates for Europeans – from identity to economics to the environment after newsletter promotion Axing a couple of public holidays would go some way towards narrowing the gap between the number of hours worked per inhabitant in France compared with competitors such as Germany, Italy, Spain and the UK – not to mention the United States or South Korea. But the French are militantly resistant to any attempt to remove acquired social rights, regardless of the economic situation, changing demography or dire public finances, as they showed with sustained social unrest over Macron's raising of the retirement age to 64. It's not that French workers actually work much less than their European counterparts. But France has less of its population in employment because of a combination of earlier retirement, later entry into the labour market, higher unemployment and welfare dependency. 'The markets and the EU are watching us,' Pierre Moscovici, the president of the French court of accounts and a former finance minister and European commissioner, said after presenting an annual report that warned that the country's debt was approaching a tipping point. 'As demanding and difficult as it may be, getting our public finances under control from 2026 is imperative for debt sustainability,' he added. France has long enjoyed the indulgence of bond market vigilantes because of its ability to raise revenue and a presumption that its debt was implicitly backed by Germany, since a French financial crisis would trigger severe turbulence in the eurozone. But several credit ratings agencies have recently lowered France's sovereign rating because of a concern that the government will be unable to enact serious deficit-cutting measures without a parliamentary majority. French people need to get real about their fiscal predicament before it descends into an acute crisis. So far there is little sign of that reality dawning on either the political class or the population. The left just keeps repeating that the government should soak the rich and reimpose a wealth tax, even though that would make little more than a symbolic dent in the deficit. The populist right argues that the state could save all the money it needs if only it stopped paying benefits to immigrants. Those numbers don't add up either. With so many politicians encouraging voters to go on believing that 'public money' grows on trees or can be borrowed in unlimited amounts – Mélenchon has argued in the past that France should default on its debt – it is hard to have a rational debate on the budget. The stage is set for another battle of wills in parliament, and probably in the street. If the uneasy grouping of centrist and conservative parties supporting Bayrou cannot get something resembling his proposed savings through the National Assembly this autumn, France may be plunged into a real financial crisis that could play into the hands of Marine Le Pen's National Rally ahead of the next presidential election, due in 2027. Paul Taylor is a senior visiting fellow at the European Policy Centre
Bloomberg
2 days ago
- Business
- Bloomberg
The Global War On Public Holidays Is Far Too Lazy
Worries about fiscal sustainability and tepid economic growth are enticing governments to embrace a simple but controversial step: reduce the number of public holidays so employees produce more. Yet the economic benefit of doing this is marginal. There are better ways to boost productivity and the number of hours worked that would neutralize bitter conflicts about how the economic cake is divided.
Bloomberg
5 days ago
- Business
- Bloomberg
Work More to Earn Less: France's New Revolution
There's been only one topic of conversation in the brasseries of France this week: Prime Minister Francois Bayrou's proposal to scrap two of three public holidays in the month of May to contain the spiraling budget deficit. In the land of the 35-hour work week, this is tantamount to treason. Most of the public seems to hate it, unions have called it a declaration of war and the far right has called it a provocation. The outrage is a little overdone. Knocking off two public holidays would leave the French with nine, which looks positively Germanic — until you add their 25 paid vacation days, which gets France in almost the same ballpark as Spain. (And no need to mention the extra days that many private-sector workers get for working more than 35 hours.) And while there's been plenty of gnashing of teeth at Bayrou's description of the month of May as 'gruyere' cheese — full of holes — it's kind of true. France is a place where the calendar is a Sudoku puzzle to find the ideal combo of holidays and vacation; this year, it's been possible to strategically place five days' vacation and get 32 days off.
Yahoo
6 days ago
- Business
- Yahoo
YAHOO POLL: Does cutting public holidays help boost the economy?
French prime minister, Francois Bayrou has made headlines for his plans to cancel two public holidays as part of radical measures to reduce France's ballooning deficit, boost its economy and manage debt. Bayrou has suggested scrapping Easter Monday and 8 May (a day commemorating the end of World War II in Europe) which would leave France with nine national holidays. The French PM believes two extra days of working would add "several billions of euros" to the country but the proposition has been met with fierce criticism from the political left and far right – and calls for Bayrou to face another no-confidence vote. Other polls YAHOO POLL: Do you neglect your health for your career? YAHOO POLL: Is it fair to ban cyclists from pedestrian-only paths? YAHOO POLL: Are you excited to watch James Gunn's 'Superman' film? But it has also gained some support. An opinion piece in The Telegraph urged Britain's chief financial minister Rachel Reeves to reconsider national holidays in the UK. "Our debt level is dangerously close to 100% of GDP (in France it's 110%) and we too have a serious productivity problem and every reason to worry about the sustainability of our public finances," wrote Jill Kirby in the piece. Bayrou's idea is that working two extra days will generate more revenue for the government but economic studies suggest it won't be as simple as that. In fact, there are also studies which conclude that leisure – or an increase in public holidays – can act as an economic boost, up to a certain point. So, we want to know: Does cutting public holidays help boost the economy? Related French PM may scrap two public holidays to reduce country's crippling debt French PM proposes cutting national holidays to cut debt France in revolt over PM's proposition to abolish two public holidays as part of budget cuts France is getting something right: let's scrap a few Bank Holidays Analysis-France's plan to cull public holidays may not help the economy
Zawya
6 days ago
- Business
- Zawya
France's plan to cull public holidays may not help the economy
FRANKFURT - The French government thinks the country has too many days off for its own good, but its proposal to cull some public holidays may not produce much of an economic benefit. Prime Minister Francois Bayrou has proposed scrapping two of the country's 11 public holidays as part of a deeply unpopular emergency plan to plug a budget hole. In his sights is Easter Monday and one of four bank holidays in May, a month Bayrou compared to Gruyère cheese for its many holes. Bayrou's idea is that working two extra days will generate more economic output and therefore revenues for the government. Recent experience from elsewhere and various economic studies suggest it won't be as simple as that. In 2023 Denmark abolished Great Prayer Day, a Christian holiday that fell on the fourth Friday after Easter and dated back to 1686, to great popular discontent. On the surface, the sacrifice paid off. The number of hours worked by the average Dane fell by less than in previous years, according to Danske Bank. Yet when it comes to economic output, which is what matters for public finances, the impact of the extra day was tiny at between 0.01% and 0.06%, according to IMF estimates. France's statistical agency INSEE put the boost to GDP of Bayrou's proposal at a similarly negligible 0.06%. This is because time off is not all bad. Of course it slows down production, particularly for manufacturing companies. But it is also considered key for mental and physical health, and typically proves a boost to sectors like tourism. LEISURE CAN BE AN ECONOMIC BOOST In fact, economic studies find that output increases along with the number of national holidays - but only up to a point. One study of 101 countries by the Centre for Future Labour Market Studies in Malaysia put that sweet spot at nine or 10 public closures in a year. "As the number of public holidays increases, initially economic growth increases, but after some optimal point, when the number of public holidays increases further, economic growth starts to decline," the researchers said in the 2023 study. The exact number may depend on the make-up of a country's economy. A study of the Italian economy, which like the French is dominated by services and has on average 12 public holidays in a year, found that economic output did not vary or even slightly increased in years with more closures, indicating it was close to its own sweet spot. "Companies have fixed production targets and work around holidays," said author Francesco Maria Esposito, an assistant professor at the Birmingham Business School. The situation was similar in Germany, where the calendar is set by the 16 states and ranges from 10 to 13 holidays. The Dusseldorf-based Macroeconomic Policy Institute (IMK) found that German states that introduced a public holiday more often than not experienced stronger economic growth than those that cut one. "The equation 'fewer holidays equals more growth' simply does not hold up," said Sebastian Dullien, IMK's scientific director. Portugal scrapped four public holidays at the height of its debt crisis in 2012 -- only to reinstate them four years later. (Additional reporting by Maria Martinez in Berlin and Leigh Thomas in Paris Editing by Mark John and Frances Kerry)
