The 35 hours are the zombies of the economic discussion in France: we can do nothing against them. Any rational economic discourse that seeks to clarify their effects on the price competitiveness of French companies is destined to fail miserably.
immediately killed, they ressurgissents, rising from among the dead and misconception, the better to render impossible any analysis and lead to aberrant policies. The zombie of time is called Manuel Valls, following a zombie near the opposite camp. Do not doubt that the year 2012 will see a mass invasion of zombies in the presidential political campaign. After all, the zombie-in-chief of 2007 won. The most
of newspapers recalled that the law as it was passed between 1998 and 2000 has been deprived of most of its substance. In particular, Bertrand Act of 2008 removed any legal constraint in the actual number of hours worked. But this is not enough, obviously. The zombie does not die.
I doubt that the zombie expires more if we examine the actual effects on the labor cost of 35 hours, even if that is the core of his argument. But I'll try.
The Zombie explains, in fact, that France has lost competitiveness due to 35 hours: employee costs too much, in his idleness legalized.
Except that it is not. The low cost of labor has increased in France between 2000 and 2008 (thus before the establishment of the TEPA). It has risen less than the average European country. Infinitely less than in the countries of Central and Eastern Europe, in full catch-up. Less than in all European countries which are facing serious problems of competitiveness due to the explosion of costs (Spain, Greece). In fact, apart from Italy, where labor productivity has stagnated during the period, only Germany and Austria have seen their labor costs increase less than in France (leading to what the average euro area is low). And that because these two countries have chosen a policy of wage deflation. Suicidal policy, which destabilizes the euro area by producing massive trade imbalances, which also was ineffective, since Germany had the third rate increase lowest in developed countries during the period.
If broader, looking at all the developed countries, this time taking into account changes in productivity work, we see again that the evolution of unit labor cost in France was not exceptional. It is lower than the average for OECD countries.
Again, it was Germany (and Japan) that really make exception, experiencing a decline in their unit labor costs: higher wages are lower than was the increase in worker productivity. And the least we can say is that wage deflation has not had the intended effects, after Italy and Portugal, Japan and Germany are the developed countries who had the fastest growth rate low between 2000 and 2007.
It is not by lowering wages that remain competitive with Asian countries: Germany, it strives in vain. The evolution of the euro exchange rate more than offset the decline in unit labor costs in Germany vis-à-vis countries outside the eurozone. His policy of deflation has therefore established a policy of non-cooperative, which has generated trade surpluses mainly vis-à-vis the only countries that share the same currency as Germany, which can not devalue. Without even allow Germany to experience sustained economic growth. The problem is
therefore not the evolution of labor costs in France, which is quite average. It is the evolution in Germany. Because we can not generalize German politics: it can not function-as long as it works-if other European countries do not lead. If all the leads, it leads to widespread deflation of the European economy, lack of aggregate demand. The choice is not between 35 hours and leave the eurozone. But between German politics and the death of deflation in the euro area.
To put it differently, it's time to talk seriously, responsible adult, Germany, because it is in the future of the euro area. And it is not in the economic debate infantilizing French, which resemble the zombie again and again the 35 hours we will succeed.
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