Ihe central subject of the pension reform is in fact that of work. Mobilizations and polls show that the vast majority of workers are against the idea of having to work two more years. Because the work has become increasingly hard, intense, meaningless for most employees. This deterioration in the relationship to work is directly linked to the economic policies and strategies of French companies aimed at combating the cost of labour.
All of these strategies are based on an idea hammered home in France since the 1980s: unemployment and the low competitiveness of French companies are due to too high labor costs, in particular due to a welfare state itself too expensive, the social security contributions which finance it representing almost half of the payroll. However, with equivalent or higher labor costs, the Germans or the Swedes, because they have been able to invest in the qualification and quality of jobs, manage to produce and export products and services of better quality or more innovative, than so they sell for more than ours.
The lack of competitiveness of the French economy is mainly linked to its positioning in the mid-range: we are too expensive for what we produce. But rather than seeking to improve the quality of our productions, to move upmarket, France preferred to produce the same thing with fewer people, by chasing down costs and intensifying the work.
Since the beginning of the 1980s, there have been a number of articles by economists and reports underlining the too high weight of the cost of labour. In 1987, employers launched “the battle of the charges”, to denounce the excessive weight of social contributions, thereby explaining the reluctance to hire and the low competitiveness of French companies. It was in 1993 that both the litany of pension reforms began, but also general plans to reduce social security contributions.
Low efficiency
Edouard Balladur, then Prime Minister, wanted to limit the foreseeable increase in pensions with his reform of July 1993, and reduce the cost of labor for companies with, in December 1993, the five-year law relating to work, employment and vocational training, the main measure of which is the reduction of part of employers’ social security contributions on low wages (between 1 and 1.2 minimum wage).
Since then, lowering the cost of labor has become the cornerstone of French economic policies, both to reduce unemployment and to increase business competitiveness. From Juppé measures to those linked to 35 hours, from Fillon reductions to the tax credit for competitiveness and employment, which became a permanent reduction in 2016, the reductions have been gradually extended to both more social security contributions (almost all at the level of the minimum wage, where only the supplementary pension and unemployment contributions remain), and to more employees, until it now concerns 3.5 minimum wage. In 2021, the total amount of exemptions reached 73.8 billion euros: France has become the European champion in business aid.
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