From Rescue to Rupture: Understanding Change in French Labour Market Policy

1. From Rescue to Rupture: Understanding Change in French Labour Market Policy Daniel Clegg University of Edinburgh Bruno Palier CEVIPOF

2. Preliminary remarks • Building on the advertised paper • The ‘Bismarckian’ model of activation (Clasen and Clegg, 2006; Clegg, 2007) • Compensation at the core, activation at the margins • An institutionalised (?) duality pf provision for unemployed • Result of institutionalised power of ‘industrial actors’ • French case as archetypal • This paper focuses specifically on French case • To look more at the politics of change • To seek to explain changes beyond the margins

3. Plan • Recent policy background • Theoretical background • Policy story • Separate insurance and solidarity • ‘Instrumentalise’ solidarity • From new instruments to new policy logics • Conclusions

4. Policy background • Since May 2007 “un bouquet de réformes tout azimuts” (Barbier, 2009) • Fusion ANPE-UNEDIC • Droits et devoirs des démandeurs d’emploi • New sanctions regime, stricter definition of suitable work • RSA replaces RMI • Activating changes that can no longer be described as marginal

5. Theoretical background (1) • ‘We need a hero’, part 1 • Large traditional literature on particular French immobilism as a result of elite failure • Smith – France let down by its leaders • Schmidt – lack of an appropriate reform discourse • And ... Sarkozy – the need for a ‘rupture’ with the timidity of the past

6. Theoretical background (2) • ‘We need a hero’, part 2 • Emergent literature on scope for ‘transformational incrementalism’ • Including contribution by my co-author • Strong on mechanisms, less strong on causes • But general (and problematic) agreement that an institutional entrepreneurmust ‘get the reform ball rolling’ and carry it onwards • Streeck and Thelen, Campbell, Crouch...

7. Policy story (1) • Separate insurance and solidarity • Paritaire unemployment insurance becomes overburdened by labour shedding in context of high unemployment • Social partners find agreement to restrict benefits through reinforcement of insurance mechanisms • Interests of core clientele + preservation of paritarisme • But (esp. unions) need state to take over labour shedding functions • And have to present this as protection for ‘new risks’ that UI could not be expected to cope with

8. Policy story (2) • ‘Instrumentalise’ solidarity • Special employment contracts (esp. from 1983) • Initially mainly in public sector • RMI (introduced 1988) • With an ‘insertion’ element • Both policies have a promotional design and rhetoric attached, but an unacknowledged labour shedding / basic protection function

9. Policy story (3) • From new instruments to new policy logics • Largely as a result of (inevitably negative) evaluations against the rhetorical benchmark of ‘promotion’ • ‘Technical’ case for more change • Public sector special measures → private sector special measures → generalised reductions in labour costs • Insertion → intéressement → low wage subsidisation (PPE then RSA) • From social treatment and insertion to activation and incentives

10. Conclusions • Yes, there has been an incremental transformation that prepared the ground for a ‘big hero’ • But no, this process was not initiated and promoted by ‘mini heroes’ • Dynamic instead created by ‘conservative’ actors seeking new ways of meeting their multiple existing goals • Esp. unions: labour shedding + defence of paritarisme • And dynamic of change carried forward by tension between form/rhetoric and function of new instruments • Institutional change stories don’t need heroes, big or little...