Tuesday, April 25, 2006

French Youth and Unemployment: Max Sawicky's Good Catch

This is worth saving; I know this is going to come up in discussions...

Somebody crunched the numbers- in particular David Howell and John Schmitt of the Center for Economic Policy Analysis at the New School figured out that yep, the French youth aren't massively unemployed as we define unemployment.

From that link:

There is no doubt that the official youth unemployment rate in France is very high. At 22 percent, it was substantially above the U.S. rate of 11 percent (and even further above the U.K. rate of 9.9 percent and the Dutch rate of 8.1 percent).1 But this “catastrophic” French rate reflects the technical definition of unemployment, which is more appropriate for prime-age workers than it is for youth. The official unemployment rate measures the unemployed (those willing and able to
work and currently searching for a job) as a share of the labor force -- the unemployed and the employed. This definition means that, in two countries with the same number of youth and the same number of unemployed youth, the unemployment rate can be hugely different, depending on how many of the young people are employed.2 On this score, the difference between the U.S. and France is huge: Row 3 of the table shows that in 2004 only 32.8 percent of French male 15-24 year olds were employed (at least one hour in the survey reference week), compared to 61.9 percent of young U.S. men.
Key Labor Market Indicators for Male Youth for the U.S. and France, 2004
U.S France
1. Unemployment rate (U/U+E)
11.8 20.8
2. Labor Force Participation Rate (U+E/population) 70.2 41.4
3. Employment Population Rate (E/population) 61.9 32.8
4. Unemployment to Population Rate (U/population) 8.3 8.6
Source: statistical annex, OECD Employment Outlook 2005
The fact is that the incidence of unemployment in the total youth population is about the same in the two countries. As the table shows, for male youth the unemployment-topopulation rate is 8.3 percent in the United States and 8.6 percent in France. The unemployment-to-population rate for female youth is lower in both countries: 7.4 percent in France and 6.5 percent in the United States.3 The dramatic difference between France and U.S. is not the relatively large numbers of youth who are unemployed in France, but the relatively small number of employed French youth, especially students. Using the proper yardstick – relative to the youth population - the magnitude of the youth unemployment problem in France is almost indistinguishable from the situation in the United States.

Chalk yet another one up again to our "liberal" media.

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