France’s “yellow vest” crisis is set to last as there is no short-term solution

France is implementing reforms to improve , in the long term , labour force skills, the sophistication of companies and the efficiency of the state. But the French president and government, which had focused on this medium-term agenda, now face demands for a rapid improvement in purchasing power, to which there is no short-term solution: Income distribution is already favourable for wage earners; It is difficult to imagine an even higher tax burden (including on the highest incomes) or fiscal deficit; Competition via production costs is strong between France and other countries; Low-skilled employment is very sensitive to low-skilled labour costs.