French jobless likely to touch new high

The French economy will stagnate this year, pushing the jobless total to its highest level in more than 12-1/2 years, France's unemployment fund said on Thursday, in another blow to President Nicolas Sarkozy ahead of a presidential vote. Unedic ((National Professional Union for Employment in Industry and Trade) said it expected the number of people out of work to rise by 214,500 by the end of 2012, taking the headline unemployment figure to 3.07 million from 2.86 million at end-2011, which was the highest level since April 1999. Gross domestic product would remain unchanged over the period, Unedic said, contrasting with the government's official forecast for growth of 1.0 per cent over the full year. Gloom Article continues below The news came just a day after Sarkozy unveiled a job aid package worth ¤430 million in a bid to tackle the economic gloom that is threatening to hamper his bid for re-election in April and May. The centre-right president is trailing Socialist rival Francois Hollande in opinion polls, and he is now under severe pressure from far-right candidate Marine Le Pen, raising the threat that Sarkozy might not even make it through to the second round. Economists widely predict France entered recession in the fourth quarter of 2011 and expect the economy to struggle to gather momentum over the rest of 2012. A Reuters poll on Thursday showed GDP is forecast to eke out growth of just 0.1 per cent this year, while unemployment is seen rising to 10.1 per cent from 9.8 per cent at end-2011.