Geneva struggles to stem soaring unemployment

swissinfo SRI, 7 March 2004, 12:00 PM

The line outside Geneva's unemployment office is longer than anywhere else in the country—and has been for the past two decades.

With a jobless rate of seven per cent—almost three per cent higher than the national average—pressure is mounting for cantonal officials to make more effort to tackle the problem.

Since the mid-1970s, Geneva has consistently topped the Swiss unemployment charts as the canton with the highest number of people seeking work.

Local officials blame economic factors such as stiff competition and the sluggish state of the national economy for the region's poor track record.

Geneva is a very sought-after economic centre, said Carlo Lamprecht, the head of canton Geneva's Employment and Economics Department. There are a lot of people coming here in search of work from around Switzerland, not to mention cross-border workers from France.

This gives employers an incredibly diverse workforce to choose from, but it also creates a lot of competition amongst job seekers, he told swissinfo.

Social reform

Analysts tend to agree that Geneva's location and highly competitive workforce are major contributing factors to its persistently high unemployment rate.

But they also blame the canton's unemployment insurance scheme for allowing so many people to remain on the dole.

The fact that wages tend to be very attractive in Geneva certainly leads a lot of people to seek work here, said Yves Flückiger of Geneva University's Employment Observatory.

But it's also a social problem because Geneva has a special system that allows job seekers to remain unemployed for up to five years and that doesn't really exist elsewhere in the country, he told swissinfo.

The Swiss economics ministry has also urged the canton to drastically reform its unique temporary work programme, which offers short-term public sector jobs to people whose benefits have run out.

The problem with the scheme, according to Flückiger, is that the placements last for 12 months, after which job seekers are entitled to go back on unemployment.

It sounds like a good idea to get people to work for the canton, explained Flückiger.

But these jobs should only be for six to eight months so that people cannot automatically reapply for benefits... Otherwise, there is no incentive to get additional training or actively look for work.

Pressure

The federal authorities agree that the programme needlessly prolongs the average duration of unemployment and fails to provide people with the types of skills needed to re-enter the workforce.

And the issue is threatening Geneva's exemption from a federal law that limits benefits for most job seekers to 400 days.

The canton has twice been allowed to change the rule and pay out on claims for up to 520 days, because its unemployment rate remained above five per cent for six consecutive months.

But its current extension runs out on June 30 and the government is leaning hard on local officials to change the unemployment system or risk being denied a further extension.

EU influx

What's more, Switzerland's increasingly close ties with the European Union could spell even more bad news for job seekers in the region come this summer.

As of June 1 this year, Swiss citizens will no longer have priority over EU nationals when it comes to jobs, thanks to an agreement on the free movement of people which is set to enter a second phase.

The fear in Geneva is that an influx of workers from neighbouring France will further drive up workforce competition, although Lamprecht says the canton has taken steps to limit the effects of the bilateral deal.

With the free movement of people there is a danger that local workers will have more trouble finding jobs, said Lamprecht. So we really need to invest in training for jobseekers and in highlighting home grown talent.

Also in order for non-Swiss to work here, they will still need a work permit and that implies that there are jobs on-offer…and for the moment that simply isn't the case.

swissinfo, Anna Nelson in Geneva