Almost five years after the start of the discussions, the Labor 2 Act will finally be voted on this Tuesday at 5pm. On the menu: a reform of unemployment benefits based on “counter-cyclicality”. A somewhat complex name, but which actually denotes a measure that goes against the economic cycle. This term originally comes from budget policies.
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The principle is simple: during a period of recession, public spending is increased to limit the effects of the crisis and support the recovery. In times of growth, the economy is thought to need less support. So we reduce the same expenses to make a profit.
Encourage return to work
The same mechanism can be applied to unemployment insurance, following the example of the Canadian model. The idea for the government is to tighten the conditions for compensation when the economy is doing well and jobs need to be filled. On the other hand, the state relaxes these conditions when the situation worsens, and thus when unemployment rises again.
Objective: to offer more flexibility by allowing, on the one hand, to encourage the French to return to work and, on the other hand, to better protect them in the event of a serious economic crisis, as in 2008 or during the Covid-19 pandemic.
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