An estimate of job losses in France caused by the great generosity of the pension system and the low efficiency of the public sector

We start by estimating the reduction in the tax burden on companies that could be obtained if public spending on pensions and labour productivity of government agencies were the same in France as in the other euro-zone countries; it is 5.2 percentage points of GDP. We then look at the correlation that exists, for OECD countries, between the tax burden on companies, and in particular the burden of corporate social contributions, and the employment rate. This enables us to conclude that the great generosity of the pension system and the low efficiency of the public sector in France lead to a 7 percentage point loss in the employment rate (which was 66% in 2019).