French labor unions are holding a third day of mass strikes and protests against raising the retirement age, keeping up pressure on the government as parliament debates the proposed reform.
(Bloomberg) — French labor unions are holding a third day of mass strikes and protests against raising the retirement age, keeping up pressure on the government as parliament debates the proposed reform.
Widespread disruption is expected Tuesday on the Paris subway, with limited service on most lines. France’s rail operator, SNCF, expects only half of high-speed TGV trains to run and has advised people to postpone travel.
Some workers at power company Electricite de France SA and oil company TotalEnergies SE are set to walk out. Many schools are expected to close.
Unions plan to build on the momentum they saw in the first two rounds of strikes last month in an attempt to make President Emmanuel Macron back down on his proposal to raise the minimum retirement age from 62 to 64. A fourth day of protests is already planned for Saturday.
The second day of action on Jan. 31 was the biggest backlash yet against the French leader — who has pledged to see his program through — with at least 1.27 million people marching across the country. Opinion polls suggest opposition to the reform is growing, and unions are looking to rally even more support.
Lawmakers in the National Assembly started to review the draft pension reform bill on Monday.
In a bid to win over more people, Prime Minister Elisabeth Borne said in an interview with Le Journal du Dimanche newspaper this weekend that the government was considering another carve-out so more workers can retire before they turn 64.
The concession would add to other provisions designed to allow those who began working at a young age to retire earlier. Whether this will help secure a majority remains to be seen.
If Macron cannot get enough backing in parliament, he could still use a constitutional provision, which allows a law to be adopted without a vote. That, however, would risk further stoking the anger of unions and could lead to a no-confidence vote.
What Bloomberg Economics Says:
“A wave of strikes and protests – alongside the drag from increases in food and energy prices and the tightening of credit conditions — suggests the start of 2023 will be noticeably tougher on the French economy.”
—Maeva Cousin, economist. For full analysis, click here
Widespread strikes are also testing the resilience of the French economy. Bloomberg Economics’ Maeva Cousin estimates it will underperform the euro area in the first quarter as the impact on the hospitality, transport, manufacturing and construction sectors likely cuts output by just over 0.1%.
While industrial action is adding to uncertainty around the outlook for growth, it isn’t driving it, Cousin wrote, given the greater significance of higher interest rates and the squeeze on household spending from high inflation.
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