Mon Feb 13th, 2006 at 03:30:26 PM EST
Wolfgang Munchau on FT.com has an article complaining about the mess that Europe - meaning France and Germany, not the UK of course - is making of labour reforms.
Speaking of the new long probation contracts that Agnes has been writing about he says:
The youth measure adds to the confusing array of labour contracts. It also fails to address the most widely recognised causes for the country’s high youth unemployment – excessive minimum wages and poor training schemes.
Which translates into they're too expensive and you haven't subsidised the training costs enough. We want cheaper labour and we want the government to pick up the tab for the training. Privatise benefits, socialise costs.
He the goes on to lambast the German reforms for not having much effect and complains that the Services Directive is suffering "death by parliament":
This has happened to the directive to extend the European Union’s single market programme to the services sector. The European parliament has been busy extracting tooth after tooth – and sector after sector – from this legislation. As the final vote approaches this week, some senior EU parliamentarians wonder whether the directive will make any practical difference.
In close he says:
The truth is that the French and German governments have made a mess of their labour reform programmes. If they are serious about reducing long-term unemployment, the way forward is not Hartz V or yet another of Mr de Villepin’s contracts. They will have to start from scratch and introduce reforms that meet a simple test – namely whether they provide incentives for the long-term unemployed to take up work.
Where are the jobs to come from? Is there a labour shortage in Germany?