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Factsheet for case FR-2020-31/1828 Updated – measures in France

Exceptional aid for the recruitment of young people

Aides exceptionnelles à l’embauche des jeunes

Country France , applies nationwide
Time period Temporary, 01 August 2020 – 30 June 2021
Type Legislations or other statutory regulations
Category Promoting the economic, labour market and social recovery
– Active labour market policies, incl. subsidised job creation
Author Frédéric Turlan (IRshare) and Eurofound
Case created 08 April 2021 (updated 30 July 2021)

Background information

Introduced as part of the "One young person, one solution" plan, the aid for hiring young people under the age of 26 has been available since 1 August 2020. This scheme allows the employer to benefit from €4,000 in aid over one year for a full-time position (prorated for a part-time position) for people under 26 hired on an open-ended contract or a fixed-term contract of at least three months.

Content of measure

This scheme allows the employer to benefit from a grant of €4,000 over one year for a full-time position (prorated for a part-time position) for people under 26 years of age hired on an open-ended contract or a fixed-term contract of at least three months. It is reserved for the recruitment of young people who have not been part of the employer's workforce from 1 August 2020.

It is reserved for the recruitment of young people who have not been part of the employer's workforce from 1 August 2020 and whose remuneration is less than or equal to twice the hourly amount of the SMIC.

Beneficiaries The aid is reserved for employees under the age of 26. Their age is assessed on the date of conclusion of their employment contract, and not on the date on which it begins to run. Thus, a young person who begins to perform his or her employment contract on the day of his or her 26th birthday will be entitled to the benefit of the aid if he or she concluded the employment contract before turning 26.

Where the recruitment follows a first fixed-term employment contract (CDD) which gave entitlement to the aid, the employer continues to be entitled to it even if the employee has reached the age of 26.

Employers All employers subject to the obligation to register their employees with the unemployment insurance scheme are eligible, regardless of the legal form of the company. The aid is available to public companies listed in the national register of companies with majority state control.

Employers wishing to benefit from the aid must meet the following conditions:

  • be up to date with its reporting and payment obligations to the tax authorities and the bodies responsible for collecting social security or unemployment insurance contributions.
  • not to have made a redundancy on economic grounds for the position concerned by the recruitment aid since 1 January 2020.

Updates

The following updates to this measure have been made after it came into effect.

12 May 2021

According to a study published by the Ministry of Labour (DARE) on 12 May 2021, the measure to help employers to hire young workers is said to have led to a 7% increase in employment on permanent or (long) fixed-term contracts for young people aged 22 to 25, i.e. 60,000 jobs. This study provides a first assessment of the effects of the measure on youth employment, and not only on the hiring of young people. But, according to DARES, this scheme would not have had any effect on the total employment of these young people, mainly because of a negative effect of the aid on self-employment and temporary employment for 22-25 year olds.'These initial evaluations, which will have to be confirmed, suggest that the measure would have favoured a shift in the employment of young people aged 22 to 25 towards long-term fixed-term contracts and permanent contracts, without leading to an increase in the employment rate of these young people'.

23 February 2021

A decree of 23 February 2021 extends by 30 June the exceptional aid for the recruitment of young people in the face of the health crisis linked to the COVID-19 pandemic. Thus, whereas they were due to expire on 31 March 2021, the aid for the recruitment of young people under the age of 26 is available until 30 June 2021.

For recruitments made between 1 April 2021 and 31 May 2021, the maximum level of remuneration for young people eligible for this aid is reduced from 2 x Minimum wage (SMIC) to 1.6 x Minimum wage. In addition, it must be applied for by the employer within a maximum of four months following the date on which the contract begins to run, so no application may be sent after 30 September 2021.

30 January 2021

A decree of 30 January extends by two months the exceptional aid for the recruitment of young people in the face of the health crisis linked to the COVID-19 pandemic. Thus, whereas they were due to expire on 31 March 2021, the aid for the recruitment of young people under the age of 26 is available until until 31 March 2021.

Use of measure

Despite the measure, according to the DARES (Situation sur le marché du travail durant la crise sanitaire au 2 février 2021), for the year 2020 as a whole, the number of hires of young people under 26 years of age on permanent and fixed-term contracts of more than three months is 14.2% lower than that recorded in 2019. This decline is slightly less pronounced than that of the number of hires on permanent or fixed-term contracts of more than three months for all under-30s (-15.8%).

In December 2020, the number of hires of under 26 on permanent and fixed-term contracts of more than three months was 27.4% lower than in December 2019. However, the decline in hires following the second lockdown is significantly less than in the first lockdown (-57.9% between May 2019 and 2020).

Target groups

Workers Businesses Citizens
Youth (18-25) in employment
Applies to all businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
Trade unions
Employers' organisations
Public employment service
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Consulted Consulted
Form Any other form of consultation, institutionalised (as stable working groups or committees) or informal Any other form of consultation, institutionalised (as stable working groups or committees) or informal

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: Peak or cross-sectoral level

Involvement

Social partners are consulted during the elaboration of such measure.

Views and reactions

Social partners have mainly welcomed the measure to support youth employment, even some point out potential windfall effect.

Sources

  • 05 August 2020: Décret n° 2020-982 du 5 août 2020 instituant une aide à l'embauche des jeunes de moins de 26 ans (www.legifrance.gouv.fr)
  • 30 January 2021: Décret nº 2021-94 du 30 janvier 2021 relatif à l'aide à l'embauche des jeunes de moins de 26 ans et aux emplois francs (www.legifrance.gouv.fr)
  • 23 February 2021: Décret n° 2021-198 du 23 février 2021 relatif aux aides à l'embauche des travailleurs handicapés et des jeunes de moins de 26 ans et aux emplois francs (www.legifrance.gouv.fr)
  • 31 March 2021: Décret n° 2021-363 du 31 mars 2021 portant modification et prolongation des aides à l'embauche des jeunes de moins de 26 ans, aux emplois francs et aux employeurs d'apprentis et de salariés en contrat de professionnalisation (www.legifrance.gouv.fr)
  • 12 May 2021: DARES (2021) Quels ont été les effets de l’aide à l’embauche des jeunes sur l’emploi des jeunes ? Premières évaluations de l'AEJ (dares.travail-emploi.gouv.fr)

Citation

Eurofound (2021), Exceptional aid for the recruitment of young people, case FR-2020-31/1828 (measures in France), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.