Wednesday, June 27, 2007

Not So Big Mo'

They have a word for it, oxymoron:

France faces two years of stagnant economic momentum....
Well, at least their heart is in the right place:

...and must deepen structural reform by curbing wage growth, scaling back job protection and ensuring that older people stay on the job, the OECD said Wednesday.

The Organisation for Economic Cooperation and Development warned French authorities that measures designed to shield certain jobs and industries from competition would prove to be costly and ineffective.

....The OECD argued that increasing the minumum wage was not a "good instrument" for fighting poverty and called for an earned income tax credit targeting poor families.
It said the minimum wage should grow "at much slower rates in the future," rising no faster than productivity gains of low-skilled workers.

The report also called for an "overhaul" in French employment protection measures through a single contract under which protection would increase in line with experience in the company.
It added that "the judgment as to the economic relevance of a decision to dismiss one or several employees (should be left) to the employer alone."

Elsewhere it recommended that incentives to retire early should be scrapped, adding that "two decades of policies have encouraged workers to retire early in the unfounded belief that this might boost youth unemployment."

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