After having plunged into the red under the effect of the crisis, the accounts of the unemployment insurance should almost return to the balance in 2023. This is what reveals the “financial forecasts” presented, Thursday, June 17, by Unédic, the association co-piloted by the social partners which manages the compensation system for job seekers. Eric Le Jaouen, Chairman (Medef) of the Board of Directors, sees this improvement as proof of the “Solidity” and some “Resilience” of the system.
Data released on Thursday shows unemployment insurance remains reeling from the recession triggered by the Covid-19 epidemic. After reaching a record level of – 17.4 billion euros in 2020, the deficit of the regime should decline this year, while remaining massive, at – 12 billion. This figure for 2021 is higher (by 2 billion) than the previous extrapolations carried out in February, because the reconfinement decided at the beginning of the spring caused an increase in expenditure linked, in particular, to the increased use of short-time working, its cost being partially borne by the ‘Unédic. In addition, the extension until the end of June of compensation for job seekers who have reached the end of their rights has inflated the bill.
But the situation is likely to see a clear improvement from the second half of the year, with the decline of the epidemic and the gradual lifting of restrictions imposed on companies. “Activity will return to its pre-crisis level in 2022”, which would work in favor of the finances of the regime, as underlined by the note released on Thursday: partial unemployment would absorb much less resources and the number of beneficiaries would be reduced, thanks to the “Rebound” in the labor market. In addition, the entry into force of the unemployment insurance reform, from 1is July, “Would start to generate savings”. An allusion to the new rules included in a decree of March 30 which change the methods of calculating the benefit and will lead to a decrease in the monthly amounts paid: between July 2021 and the end of June 2022, some 1.15 million people would be entitled to an allowance daily 17% lower on average than that they would have touched with the previous provisions, according to Unédic.
There is, however, a major unknown, due to the fact that six unions recently appealed to the Council of State to demand the suspension of the decree of March 30. If the decision of the high court, which is imminent, gives them success, it risks calling into question the expected savings. In the opposite case – that is to say a reform which applies as planned -, the deficit of the system would be reduced to – 2.4 billion euros in 2022, before being practically absorbed the following year. (- € 500 million).
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