The Africanisation of the French Economy

[Dave Bloke]

There was an interesting discussion on BFM Radio this morning. This is an economy channel and BFM is on the woker side of politics.

The debate, between some economists was about the minimum wage in France. (SMIC). Currently at 1 709,28 € per month and, unlike everyone else, indexed with inflation. There is also the RSA, 607,75 € per month. A kind of universal benefit but it is a gateway to state housing, childcare, free health care and a pension of around 950 € / month at 63 without ever having paid a penny in taxes. Many immigrants live quite nicely of this without troubling themselves with actually, like, you know, working.

First thing I didn't realise is that there are a lot of people paid less than the SMIC as their industry sector signed an agreement on wages and their salaries have now been overtaken by the SMIC.

At the level of the SMIC employers don't pay payroll taxes, I think there is just a contribution for health care. Payroll taxes are extremely high in France, I'd have to check my pay slips but about half my salary is deducted by my employer in social charges.

If an employer pays SMIC + 1 euro they suddenly have to find around 450 euros of extra payroll taxes. So it is very hard to get paid more than the SMIC, it is both a minimum and maximum for many people.

The economists made the point that France has become a low skilled economy. The jobs that are available are not competitive at more than the SMIC, the economy has adapted to the minimum wage. Employment has gone to where there are subsidies and has shrunk from where there are high taxes (skilled jobs).

France had a similar GDP per capital to Switzerland in the 1970s. It is now half of Switzerland. Back in the seventies a middle earner, say a teacher, could own their home outright and have maybe a flat in the Alps and one at the seaside and retire at 55!

Currently employers are crying out for more unskilled labour and want up to 1 million illegals currently in France to be given work permits. This would  suck more money out of the higher skilled sector; the country is in a kind of viscous circle of low wage jobs creating more low wage jobs and destroying the middle classes and skilled labour through increasing taxes.

I thought this might have echoes in the British economy.

[Yadda yadda yadda]

5 minutes ago, Dave Bloke said:

France had a similar GDP per capital to Switzerland in the 1970s. It is now half of Switzerland.

Quite the statistic that.

It does sound like the UK. Although perhaps worse. The advantage France has is that there is plenty of livable and affordable countryside.

Here part time minimum wage jobs are the ones that avoid employers tax whilst enabling benefits. There isn't the cliff edge of earning £1 more triggering hundreds of extra taxes. There are definitely incentives to a low skills, low wages and Government subsidies.

[Dave Bloke]

7 minutes ago, Yadda yadda yadda said:

The advantage France has is that there is plenty of livable and affordable countryside.

absolutely none of it near where there are jobs. There is livable and affordable countryside in the UK - up north.

Somewhere like Lyon, a bit like the French Manchester, you pay about 8,000 euros per sq mt (9 sq foot) for an apartment. It is impossible for most people to rent in the private sector as rent controls and landlord hostile tenancies have killed the rental market. As a result some people end up sleeping in shanties or their cars/van if they have a job locally.

Edited December 2, 2023 by Dave Bloke

[Errol]

[whocares]

5 hours ago, Dave Bloke said:

There was an interesting discussion on BFM Radio this morning. This is an economy channel and BFM is on the woker side of politics.

The debate, between some economists was about the minimum wage in France. (SMIC). Currently at 1 709,28 € per month and, unlike everyone else, indexed with inflation. There is also the RSA, 607,75 € per month. A kind of universal benefit but it is a gateway to state housing, childcare, free health care and a pension of around 950 € / month at 63 without ever having paid a penny in taxes. Many immigrants live quite nicely of this without troubling themselves with actually, like, you know, working.

First thing I didn't realise is that there are a lot of people paid less than the SMIC as their industry sector signed an agreement on wages and their salaries have now been overtaken by the SMIC.

At the level of the SMIC employers don't pay payroll taxes, I think there is just a contribution for health care. Payroll taxes are extremely high in France, I'd have to check my pay slips but about half my salary is deducted by my employer in social charges.

If an employer pays SMIC + 1 euro they suddenly have to find around 450 euros of extra payroll taxes. So it is very hard to get paid more than the SMIC, it is both a minimum and maximum for many people.

The economists made the point that France has become a low skilled economy. The jobs that are available are not competitive at more than the SMIC, the economy has adapted to the minimum wage. Employment has gone to where there are subsidies and has shrunk from where there are high taxes (skilled jobs).

France had a similar GDP per capital to Switzerland in the 1970s. It is now half of Switzerland. Back in the seventies a middle earner, say a teacher, could own their home outright and have maybe a flat in the Alps and one at the seaside and retire at 55!

Currently employers are crying out for more unskilled labour and want up to 1 million illegals currently in France to be given work permits. This would  suck more money out of the higher skilled sector; the country is in a kind of viscous circle of low wage jobs creating more low wage jobs and destroying the middle classes and skilled labour through increasing taxes.

I thought this might have echoes in the British economy.

Depressing situation!

[Dave Bloke]

On 02/12/2023 at 17:11, whocares said:

Depressing situation!

Don't worry, Pres. Macron will have all the Boudin he can eat at the Olympics

[whocares]

3 hours ago, Dave Bloke said:

Don't worry, Pres. Macron will have all the Boudin he can eat at the Olympics

I thought "boudin" meant "sausage"? But Google translates it as "black pudding".

Anyway, I think we all get the idea! 😁

[Loki]

On 02/12/2023 at 11:13, Errol said: