French unions, employers reach deal on job training reform

By Emmanuel Jarry

PARIS (Reuters) – French unions and employers struck a deal on Saturday to overhaul a costly and inefficient job training system by devoting more funds to the unemployed.

The move comes as President Francois Hollande is seeking to stimulate a moribund job market.

France spends some 32 billion euros each year on job training, but much of the money is spent to train people who already have jobs and critics say too little goes to the unemployed and low-skilled most in need of new professional skills.

The deal, reached two months after the Socialist government called on unions and employers to start reform talks, is Hollande’s latest effort to improve a job market plagued by 11 percent joblessness.

It foresees increasing funds to train the unemployed to 900 million euros ($1.24 billion) per year from 600 currently, creating a personal account for job training funds that workers can carry between jobs, and simplifying rules on financing.

“The draft fulfils goals set by the government, notably by offering more training to those who need it most: job seekers, less-skilled workers and employees of small companies,” Prime Minister Jean-Marc Ayrault said in a statement.

Five trade unions and the MEDEF employers association reached a broad agreement early on Saturday on how to improve the system. Their accord will form the basis of a draft law to be reviewed in cabinet on January 22. No date has been set for the bill to be submitted to parliament.

Critics say the current job training system, in which firms must devote 1 percent of their total wage spend each year to job training, is inefficient because unions, which manage the training schemes, have too little oversight.

Economists often compare the French system unfavourably to Germany’s, where a job training is more reliant on apprenticeships and is cited as an economic strength.

The draft accord struck in the early hours of Saturday aims to beef up oversight by making company management and unions set goals for training together.

“This reform is of major importance, it aims to make workers more employable,” said Pierre Gattaz, head of the Medef employers’ union. “If it is concluded, our whole society will be able to regain the growth that is so dearly needs.” ($1 = 0.7283 euros)

($1 = 0.7283 euros)

(Writing by Nicholas Vinocur Editing by Jeremy Gaunt)

French unions, employers reach deal on job training reform