Geneva remains Switzerland’s unemployment blackspot

unemployment Keystone

Switzerland has been celebrating its lowest unemployment figures for eight years. But one canton, Geneva, remains the country's worst jobless blackspot, with twice as many unemployed as the national average.

The new figures show that the Swiss unemployment rate for 2000 stood at 1.9 per cent. In Geneva the figure was 4.4 per cent. Economic experts agree that there is no single reason for the canton’s stubbornly high jobless rate, rather there are a host of factors.

Chief among these is the fact that Geneva is an essentially urban canton, and cities tend to have more unemployment than rural areas.

“There’s less stigma attached to being unemployed in the city,” says Jean-Pierre Thorel, of Geneva’s Economic and Social Council. Yet while the city of Geneva’s rate is over five per cent, those in the cities of Zurich (2.5 per cent) and Basel (1.9 per cent) are much lower.

Granted, some comparable urban areas, such as Lausanne and Fribourg have rates of over four per cent. But, but when combined with the rest of their cantons, the figure falls considerably.

“The job market is more fluid in urban areas,” says Yves Flückiger, professor of economics at Geneva University. “People change jobs more often and they often sign on between jobs, which is not necessarily a bad thing, as it allows them to take their time and find the right job.”

One key factor in Geneva’s place at the top of the unemployment league table is the fact that its legislation is more generous to those out of work than other cantons.

The Geneva authorities have instituted a kind of safety net for those people coming to the end of the two-year period during which they are permitted to claim unemployment benefit.

They are offered a one-year temporary job, after which they can again claim benefit, effectively allowing them to be on social security for five years. These people, who would not be counted in other cantons, are included in Geneva’s figures.

“By limiting the amount of time a person can claim benefit, the federal law forces people to find work more quickly,” Flückiger explains.

“But this creates a statistical illusion, because someone who takes an unsuitable job runs the risk of being quickly out of work again,” he says.

The Geneva system is criticised because the one-year “bridge” between the two periods of unemployment is better paid than many low-paid jobs, thus dissuading the person from seeking genuine employment and distancing him from the job market.

“In other cantons these people simply disappear from the statistics,” says Yves Perrin, director of the cantonal employment office.

The hotel and restaurant sector is a major employer in Geneva. But it often pays poorly and staff turnover is high: “The low wages offered in these sectors are not very attractive when you compare them to benefits,” Flückiger says.

A large proportion of those employed in the service sector are foreigners. Geneva has the highest proportion of foreigners in Switzerland – around 40 per cent of its population. Many employers complain that these people do not have the skills they are looking for.

Yet recent studies have shown that Geneva has been very successful in helping unemployed foreigners to find work.

Perrin says one of the problems is geographic: “The lack of a hinterland reduces the amount of worker mobility,” he says.

Instead of a hinterland, Geneva has a massive pool of labour just over the border in France, into which local and international companies in the city can tap.

by Roy Probert