[Enemies of Reform⑧] Successful French Labor Reform... Macron's Determination

Although most labor reforms in our country have been recorded as failures, there are reforms abroad that are considered successful cases. A representative example is France's labor market reform, which took place over a long period from 2016 to 2019. France, which had been suffering from high unemployment rates, achieved meaningful results such as increased employment rates and growth rates through labor reforms. The approval rating of President Macron, who was elected as the youngest president in 2017 and led the reforms, soared vertically, and he succeeded in re-election last April. It was the first time in 20 years that a French president continued his term through re-election. 'Enemies of Reform'

The core of the French labor reform promoted by President Macron is ‘flexicurity.’ Since the 2008 global financial crisis, France had been struggling with high unemployment rates, low labor market participation rates, and a deepening dual labor market structure. When President Macron took office in 2017, the unemployment rate had risen to 9.5%. However, four years after pushing reforms focused on labor market flexibility, the unemployment rate dropped to 7.4% at the end of last year, the lowest in 15 years. At that time, not only our country but also major foreign media evaluated it as "evidence that the government's policy efforts are bearing fruit."

Professor Jeong Seung-guk of the Department of Social Welfare at JoongAng Seungga University explained, "France shortened the period during which the validity of dismissals can be contested and set limits on compensation for dismissal," adding, "Also, labor courts simplified the dismissal procedures." Although the direction of flexibility is pro-business, France also implemented stability measures such as providing economic support to workers in unstable employment and strengthening vocational training to enhance employability. This is the flexicurity pursued by the European Union (EU). Our country, where productivity is declining due to rigid working hours and wage systems and polarization is worsening, can also refer to this reform direction.

[Image source=Yonhap News]

According to the recent report ‘President Macron’s Economic Reform and Re-election’ released by the Federation of Korean Industries (FKI), France’s growth rate stands out the most among the five major European countries (France, the UK, Germany, Spain, and Italy). The Organisation for Economic Co-operation and Development (OECD) expects France’s real Gross Domestic Product (GDP) to grow the most among these countries by 2023. The FKI analyzed that the bold labor reforms by the Macron government are a growth factor. Kim Bong-man, head of the FKI International Headquarters, emphasized that "France actively promoted labor reforms and created a business-friendly environment," and that President Yoon should also pay close attention to President Macron’s leadership.

Then, was there no labor struggle like in our country during France’s reform process? Many European countries have experienced repeated strikes whenever they pushed labor reforms. France also saw large-scale union strikes during the labor reforms under President Fran?ois Hollande in 2016, and President Macron faced a crisis when the 'Yellow Vest protests,' which started in 2018 over fuel tax increases, shook the entire country. President Macron, an 'elite politician' who graduated from the prestigious Sciences Po (Paris Institute of Political Studies), was labeled as the 'president of the rich.'

However, the results of the structural improvements pushed forward despite such opposition have appeared as France’s growth, drawing more attention to President Macron’s style. President Macron in his first year and current President Yoon Seok-yeol share many similarities, such as limited political experience and facing strong reform pressures. Professor Jeong said, "Currently, it is difficult to say that our country is in an economic crisis as severe as France’s when it pushed reforms, so it is not easy to promote reforms unilaterally by the government," but added, "Basically, reform is about enduring opposition and pushing forward based on public support."