France is grappling with a ballooning deficit, prompting significant tax hikes and aggressive cost-cutting measures announced earlier this month.
Of the many measures the French government has taken, it will also crack down on absenteeism in civil services, addressing an ever-growing problem costing the economy €15 billion.
Tackling absenteeism would unlock about €1.2 billion in savings as part of French Prime Minister Michel Barnier’s €60.6 billion worth of cost-cutting and tax hikes for 2025, Bloomberg reported Sunday.
Much of the savings will ultimately come from dismantling reserves set aside for emergencies.
France’s budgetary crisis has crescendoed to a point where its deficit is twice that of the European Union limit of 3%. That resulted in Moody’s cutting France’s credit rating outlook to “negative” after two prior warnings on the decay of the country’s public finances.
“The risks to France’s credit profile are heightened by a political and institutional environment that is not conducive to coalescing on policy measures that will deliver sustained improvements in the budget balance,” Moody’s said in a statement Friday.
The ratings agency also added that France had a relatively large population of older individuals. Still, it was losing out because it wasn’t maximizing the older workforce’s potential, leaving it to handle mounting aging costs.
What is France’s absenteeism problem?
Absenteeism is when employees don’t show up at work repeatedly, sometimes for a prolonged period of time, beyond genuine reasons such as medical problems or vacations.
The trend of workplace truants has been an ongoing problem for the French economy. In the public sector alone, its rate jumped by an alarming 80% between 2014 and 2022 to 77 million days.
Workplace absenteeism in France hit a record high last year, insurer Axa reported, and was especially rampant among under-30s. A combination of reasons is driving this—from lower career aspirations to psychological problems set off by the COVID-19 pandemic.
The U.K. Also faces similar problems, albeit to a lesser degree. In 2022, the sickness absence rate, which refers to the number of working hours lost, among U.K. Public sector workers alone was 3.6% compared to 2.3% among those working in the private sector.
Mental health remains one of the primary reasons for the recent upward trajectory in the U.K. And other parts of Europe.
The French government warned that 3,000 public sector jobs will be cut as part of the cost-saving drive, and those taking more sick leave will likely face the budget’s heat. Of the €60 billion worth of cuts and tax rises, two-thirds will come from cost-cutting efforts, while the rest will be from taxes levied on the rich.
The finance ministry said that minor tweaks—such as paying state workers from their third sick leave rather than the first—could result in over a billion euros in savings, AFP reported. Those measures would not apply to those on maternity leave, in work accidents, or with serious illnesses.
“We must have the courage to take difficult decisions today to avoid more difficult choices in the future,” public administration minister Guillaume Kasbarian told Le Figaro newspaper.
