PARIS — French apparel makers are bargaining with the government over a program that would slash payroll charges in exchange for manufacturer guarantees to limit layoffs and hire young people.
The savings would apply to apparel, textiles and shoe manufacturers and would total $420 million (2.1 billion francs) a year for two years, according to the package proposed last week by French Industry Minister Franck Borotra.
The plan was designed to boost the competitiveness of the three sectors by as much as 15 percent. French manufacturers have been under competitive pressure from Asia and, closer to home, from Italian and Spanish firms that benefited from the 1992 devaluations of their currencies. The French government is hoping subsidies will head off layoffs in the three sectors.
Together, the apparel, textiles and shoe industries employ 340,000 and industry experts estimate that to remain profitable, they will have to shed 60,000 jobs over two years. Those layoffs would cost the government $2.4 billion (12 billion francs) in unemployment benefits payments.
The government has asked manufacturers accepting the payroll cuts to agree to maintain 35,000 of the threatened jobs over two years, to hire 7,000 workers under age 26 and to discuss modifying workers’ hours through job-sharing and the annualization of hours (spreading total hours out over the year to suit production demands to allow for slow months). Several unions and manufacturers’ groups have complained that the job guarantees sought by the government are too strict, and they are working to renegotiate those provisions by March 30, the deadline for the plan to be signed.
Jacques Mouclier, president of the Chambre Syndicale, said the proposal would provide welcome relief for some of the manufacturers he represents. He argued that the “details would need to be resolved,” but added that in principle, the commitment to save jobs, hire younger workers and rethink hours were all reasonable demands. European Union officials, ever on the lookout for unfair government subsidies to industry, last week sent a letter formally asking for more information on the proposals.

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