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The flags of the European Union and Switzerland flutter in the wind in Blotzheim, France June 27, 2017. REUTERS/Arnd Wiegmann

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ZURICH (Reuters) - Switzerland will start phasing in a new system of local hiring preferences from July, as it tries to head off a clash with the European Union over immigration quotas.

The new system requires employers to post job openings to employment offices in sectors where the jobless rate hits 8 percent or more, the government said on Friday. The trigger level falls to 5 percent from the start of 2020.

Parliament last year skirted a showdown with the EU by adopting the preference system, stopping short of immigration curbs that voters demanded in a 2014 referendum but which would violate bilateral accords ensuring free movement of people.

The new system gives people registered with Swiss unemployment centres a five-day head start in applying for open positions, tapping labour already on hand and in theory reducing the need to recruit foreign workers.

A quarter of Switzerland's population of 8.4 million is already foreign, stoking resentment by the populist far right.

Around 187,000 job seekers could benefit from the local hiring preference rules, the government estimated in June.

The overall Swiss jobless rate stood at 3.1 percent in November but was higher in sectors like catering, retail and construction. Practically no sector was above the 8 percent threshold.

Brussels has taken a generally relaxed view of the new Swiss system, which comes amid improving ties between neutral Switzerland and the EU.

(Reporting by Michael Shields, editing by Larry King)

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Reuters