French Labor Minister Muriel Pénicaud has announced that the country will extend its “temporary unemployment” scheme established in response to the coronavirus crisis for up to an additional two years.
Under the program, France pays subsidies to companies to fund the salaries of those prevented from working by the crisis. At the end of April, about 8.6 million employees were benefiting from the scheme. Minister Pénicaud did not say what share of wages the French government would continue to pay—currently 84-100 % of net salary for the lower-paid—but that it was under discussion with employers and trade unions.
Although France’s public sector deficit is set to rise to 11.4 % of gross domestic product this year from 3 % in 2019, ministers say the alternative of paying benefits to millions of unemployed workers would also be expensive.
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