Präsentation von Adrien Perret im Rahmen eines Webinars vom OECD Berlin Centre am 26. November 2020.

1. NOVEMBER 26TH, /2020
Job retention schemes during the
COVID-19 lockdown and beyond
the case of France
Adrien Perret
Deputy Director for Social Policy and Employment
French Treasury
Ministry for the Economy, Finance and the Recovery
1
Direction générale du Trésor

2. 221/10/2020
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1. The French scheme of Activité partielle
2. Sectoral reallocation and training during short-time
work
Outline

3. 3
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Significant job losses,
though far below the magnitude of the economic shock
Quarterly change in employment and GDP
Source: Insee

4. 4
Short-time work as a massive support
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Weekly short-time work incidence
(% of workers)• One of the most generous schemes in Europe:
public funding of the full employees’ compensation
(70 % of gross hourly wage, up to a ceiling of 4.5
hourly minimum wage)
• March - September : 16.7 million employees
concerned by a prior approval of the short-time
work scheme
• As of the end of November, 1.9 bn hours have
been compensated over the months March to
September, at a cost of €20.1 billion.
Source: Insee, Labour Force Survey

5. The French short-time work scheme over 2020
5
Before Covid
Covid period
New general scheme
as from 2021 Jan 1st
Long-duration scheme
as from July 1stUntil June 1st
From June 1st
to December 31st
Compensation of
employees
(% of gross wage)
70%
(100% at min wage)
70%
(100% at min wage)
70%
(100% at min wage)
60%
(90% at min wage)
70%
(100% at min wage)
Public
compensation
(% of gross wage)
Lump-sum
(7.74€/h for SMEs,
7.23€/h otherwise)
70%
up to 4.5 min wage
(100% at min wage)
60%
up to 4.5 min wage
(100% at min wage)
36%
up to 4.5 min wage
(90% at min wage)
60%
up to 4.5 min wage
(90% at min wage)
Length
6 months
renewable up to 1 year
3 months 7 months
3 months
renewable up to 6 months
6 months
renewable up to 2 years
Training costs No 100% covered 100% covered 70% covered 80% covered
Conditions
Workers concerned not
laid off
Workers concerned not
laid off
Workers concerned not
laid off
Idem + quarterly
information of social
partners
Firm-level agreement, max
40% reduction in hours
worked (per worker)

6. 6
Experience of the 2009 Great Recession
• France: Cahuc et al. (2018)
• Italy: Giupponi & Landais (2018)
• Switzerland: Kopp & Siegenthaler (2019).
 large, positive effects on employment and on
firm survival
 strong effects on liquidity-constrained firms
that face a temporary demand or productivity
shocks
Risk of zombification?
Giupponi and Landais (2018): despite short-time
work having targeted predominantly low-
productivity firms, zombie effects are small.
Furthermore: Covid is a pure exogenous shock
(unlike the 2009 debt crisis)
 Protect incomes and job matches in order to
prepare recovery
Why such a massive reliance on short-time work?
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7. 7
More than 3bn€ for workers and the unemployed in order to boost job reallocation and skills:
• Fund training during short-time work thanks to the national training fund
• Bonuses on the individual training accounts against training in specific occupations/areas
• Encouraging occupational changes by enabling switches through on-the-job trainings
• Enhancing digitalization of the life-long training market in France
 create educational content platforms for trainings organizations,
 offer 30,000 distance training courses.
The challenge of job reallocation & upskilling
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8. 8
The challenge of job reallocation during STW
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The national training fund scheme
(FNE-Formation)
• dedicated to training employees placed in short-
time work (activité partielle)
• financed by the government
• help facilitate the continuity of employees' activity
and to encourage their adaptation to new jobs in
the event of professional changes.
“Collective transitions” (Transitions collectives)
• new training program to enable employees whose jobs are
under threat to retrain for a job within a sector with a strong
growth potential locally
• part of the national training fund
• will be built around territorial platforms of professional transition
where will be brought together companies with employees to be
reallocated and companies with recruitment needs.
> 300
employees
300 to 1,000
employees
< 1,000
employees
Coverage (salary
& training cost)
100 % 75 % 40 %

9. 9
The challenge of job reallocation during STW
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Training for employees in short-time work
(% of employees)
Source : Dares, Ministry of Labour
In September 2020:
• Training for employees in short-time work is more common
in large companies; 21% in companies with more than 500
employees versus 11% in companies with 10 to 19 employees.
• Training for employees in short-time work is more common
in manufacturing transportation equipment (57%) and in
information and communication (46%),
• Conversely, it is particularly low in Financial activities, real
estate activities, or construction.
Source : Dares, Ministry of Labour

10. 10
Cahuc, P, F Kramarz and S Nevoux (2018), “When short-time work works”, CEPR Discussion
Paper 13041.
Giupponi, G, and C Landais (2018), “Subsidizing labor hoarding in recessions: The
employment and welfare effects of short-time work”, CEPR Discussion Paper 13310.
Kopp, D, and M Siegenthaler (2019), “Short-time work and unemployment in and after the
Great Recession”, KOF Swiss Economic Institute Working Paper 462.
Dares (2018), Changer de métier : quelles personnes et quels emplois sont concernés ?
References
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