Unemployment, working time and financialisation: the French case

This article discusses the relationship between unemployment, working time and financialisation. I examine the French experience of working time reduction (the 35 hours week). I show that real wage growth has been frozen since the mid-1980s, working time reduction has been insufficient to create the amount of jobs necessary for maintaining full employment and most of the productivity gains were devoted to the recovery in the profit share. Under these conditions, we establish two important results. The first is that the rise in unemployment rate is offset by the increase in financialisation, measured as the difference between the profit share and the investment rate. The increase in dividends is therefore the counterpart of a lack in job creation due to an insufficient reduction of working time. The analysis has two main implications: growth is not a solution in itself, and the question of distribution is central, but it implies that capitalism should operate with a lower rate of profit, which it is not willing to accept.