Unemployment, growth: it is clear, it gets better – The Obs

Growth is indeed present in France. INSEE revised its estimate Thursday, June 16 for French growth in the first quarter 2016: 0.6%, against 0.4% announced so far

And it’s not over.. The gross domestic product (GDP) is projected to increase at a “moderate pace” in the second half, but still 0.3% in the third quarter and 0.4% in the fourth, provides INSEE. GDP growth in 2016 could reach 1.6% in France

The real good news is that growth is now based on internal springs. household consumption recovers, business investment too, and the business climate is now above seasonal norms … in short, the economic engine restarted. Could this be the beginning of a virtuous circle? The renewed activity, job creation, which in turn support consumer. Growth “self-sustaining”, summarize analysts.

Our companies invest

One of the figures was particularly surprised Institute officials : business investment. After the end of 2015 registered an increase of 2.7%, they expected against a sudden. INSEE actually see that this trend continues since the beginning of the year, even it exceeds its forecast of March 2016 to 2.4% in first quarter 2016. Should we fear a bigger backlash come ? Today, INSEE expects business investment rose 4.7% in 2016.

“In terms of business investment, almost all determinants are green. The margin has almost regained its pre-crisis level, the accommodative monetary policy facilitates access to credit and the sales prospects seem clear, “said Vladimir Passeron, head of the Economic Situation department.

Unemployment in the 10% mark

End 2016, the unemployment rate is expected to reach 9.8% (against 10.2% end of 2015 ) in France and 9.5% in France. This inversion of the curve is the result of the combination of the recovery in activity and alleviation policies in labor costs, such as the tax credit for Competitiveness and Employment (CICE). In all, 210,000 jobs should be created in 2016.

consumption rebounds

the consumption had dropped end of 2015 for two reasons:

• After the attacks of 13 November , tourism has plunged.
• the temperatures have been relatively high in the fall, heating costs were low.

She rebounded in the first quarter 2016 by catch-up effect, but also due to one-time events. INSEE cites ticket sales for Euro 2016.

After this temporary improvement, households should resume normal consumption level, still up 1.6%, provides for INSEE, as in 2015

Another remarkable fact:. household investment, which fell for many years, is expected to increase this year (0.2%).

Foreign trade, penalizing

The French economy should it his salvation to the world situation? It seems in any case that the development of foreign trade is a barrier to business growth: it costs 0.7 growth in France, explains INSEE

According to Vladimir Passeron.

“imports décéléreraient slower [than expected], so that trade significantly decrease in 2016. this would be the main obstacle for the French economy this year.”

Claire Doisy