France is facing a growing deficit, leading to significant tax increases and aggressive cost-cutting measures announced recently.
Among the various steps taken by the French government is a crackdown on absenteeism in civil services, a problem that is costing the economy €15 billion.
Addressing absenteeism could result in savings of around €1.2 billion as part of Prime Minister Michel Barnier’s cost-cutting and tax hike plan totaling €60.6 billion for 2025.
A large portion of the savings will come from dismantling reserves set aside for emergencies.
France’s budget crisis has escalated to the point where its deficit is double the European Union limit of 3%, leading Moody’s to downgrade France’s credit rating outlook to “negative”.
Moody’s noted that France has a relatively high number of older individuals but is not effectively utilizing the potential of the older workforce, resulting in increased aging costs.
Absenteeism refers to employees repeatedly not showing up for work, often for extended periods beyond genuine reasons like medical issues or vacations.
Workplace absenteeism has been a persistent issue for the French economy, with the public sector experiencing an 80% increase in absenteeism between 2014 and 2022, totaling 77 million days.
Last year, workplace absenteeism in France reached a record high, particularly among those under 30, attributed to factors such as lower career aspirations and psychological issues stemming from the COVID-19 pandemic.
The UK also faces similar challenges, with a higher sickness absence rate among public sector workers compared to those in the private sector, largely due to mental health issues.
The French government plans to cut 3,000 public sector jobs as part of cost-saving measures, with stricter consequences for those taking excessive sick leave. The majority of the €60 billion in cuts and tax increases will come from cost-cutting efforts, with the remainder from taxes on wealthier individuals.
The finance ministry suggested minor adjustments, such as delaying sick leave payments until the third day, could result in significant savings. These adjustments would not apply to individuals on maternity leave, those with work-related injuries, or serious illnesses.
“We must be willing to make tough decisions now to avoid even tougher choices in the future,” stated public administration minister Guillaume Kasbarian in an interview with Le Figaro newspaper.