French unions held a third day of mass strikes and protests against an increase in the retirement age, keeping up pressure on the government as Parliament debates the controversial reform.
Metro and commuter trains in Paris were severely disrupted on Tuesday, with limited service on most lines. Only around half of the high-speed TGV trains were running across the country, according to rail operator SNCF. A dozen international Eurostar journeys were also cancelled.
Power company Electricite de France SA said about a third of workers were on strike, leading to a reduction in output of 4.12 gigawatts. About 56% of employees at facilities operated by oil company TotalEnergies SE went on strike during the morning shift.
Unions say they plan to use the momentum they saw in the first two rounds of strikes last month to try to get President Emmanuel Macron to back down on his proposal to raise the minimum retirement age from 62 to 64. A quarter day of protests is already planned for Saturday.
The extent of public discontent will be closely watched by lawmakers, who have begun reviewing the pension reform bill in the National Assembly. The government has set a deadline of February 17 to conclude the debate.
Opinion polls suggest that opposition to the reform is growing and unions are looking to garner even more support.
CGT leader Philippe Martinez said he expected a similar turnout on Tuesday for the first day of the strike on January 19, according to Agence France-Presse, when the Interior Ministry said 1 .1 million people and unions estimated participation at over 2 million.
However, early signs showed that having several days off work was starting to take its toll on some. Figures from the Ministry of Civil Service showed that the proportion of central government public sector employees joining the third furlough fell to 11.4 per cent, compared with 28 per cent a year ago three weeks
Unions have said a decline in participation is to be expected as workers cannot afford to lose wages.
In an attempt to win over more people, Prime Minister Elisabeth Borne said in an interview with Le Journal du Dimanche this weekend that the government was considering another split so more workers could retire before turning 64 years.
The concession would be in addition to other provisions intended to allow those who started working at a young age to retire earlier. It remains to be seen whether this will help to get a majority.
If Macron does not have enough support in parliament, he could still use a constitutional provision that allows a law to be passed without a vote. This, however, would risk further inflaming the unions’ anger and could lead to a vote of no confidence.
What Bloomberg Economics Says:
“A wave of strikes and protests, along with drag on rising food and energy prices and tightening credit conditions, suggests that the start of 2023 will be notably tougher for the French economy”.
— Maeva Cousin, economist.
Widespread strikes are also testing the resilience of the French economy. Bloomberg Economics’ Maeva Cousin estimates the euro zone will underperform in the first quarter, as the impact on the hospitality, transport, manufacturing and construction sectors is likely to reduce output by a just over 0.1%.
While industrial action adds to uncertainty about the outlook for growth, it does not drive it, Cousin wrote, given the greater importance of higher interest rates and pressure on household spending from high inflation
–With the help of William Horobin and François de Beaupuy.
