August 10, 2015 9:31 am

Soon after Anne-Laure Dormois-Delsol — with her three masters degrees and fluent Chinese — was told for the second time in two years that her temporary employment contract would not be renewed, she gave up looking for a job in France.

For one year, the 28-year-old handled communications for a contemporary dance company in Dijon, often doing extra hours for free. But it was a state-aided position that vanished when the subsidy ended. Her second job was a five-month maternity replacement. In between, she was out of work for several months.

“Getting a permanent job in France is an uphill battle,” she says, now full-time at a language company in Madrid, where she teaches Chinese. “It’s sad, I love my country, but I feel young people are not given a proper chance.”

Ms Dormois-Delsol’s struggle mirrors that of millions of French youngsters seeking to get on the corporate ladder.

Known for providing workers with some of the world’s most secure contracts, generous health benefits and longest holidays, France has also tolerated pockets of flexibility to help curb record high unemployment of 10 per cent. This trend has accelerated with the financial crisis and the bloc’s economic woes. Permanent jobs represent the bulk of all existing French contracts, but they make up less than 16 per cent of new contracts signed every year, down from a quarter in 2000, according to Insee, France’s statistical institute. Out of the 20m or so job contracts signed each year, two-thirds are now for less than one month.

“Over time, the French labour market, supposedly rigid, has found a form of hyper-flexibility on the margins, through temporary contracts,” said Gilles Moec, an economist at Bank of America Merrill Lynch. “This flexibility tends to affect already vulnerable people, such as women, the young, the immigrants and the low-skilled.”

Successive French governments have shied away from reforming the employee-friendly long-term contract — contrat a duree indeterminee, or CDI — for fear of union opposition. That has resulted in a dual labour market of insiders and outsiders with extreme disparities in rights. Last month, socialist President François Hollande allowed small businesses to renew temporary employment contracts twice for a total of 18 months.

“This is a mistake and typical of France to avoid difficult debates,” says Jean-Herve Lorenzi, economist at French think-tank Le Cercle des économistes, which advocates a more flexible permanent contract. “An economy cannot function with flocks of youngsters forced to accumulate four or five temporary jobs before getting a permanent position. You can’t rent an apartment nor get a loan without long-term employment.”

In the past three decades, the chance of a temporary position resulting in a permanent one has dwindled from 62 per cent to 25 per cent, according to data compiled by Insee.

It took precisely one year and two months of successive three- to four-month contracts for corporate law graduate Justine Faure, 26, to become permanent staff at a Paris-based healthcare institution last year.

“It was stressful every time, not knowing whether the contract would be renewed,” she recalls.

Journalist Melanie Loyen, 28, was less lucky. After her seven-month job at a radio station expired, she was told to come back after a two-month break, the required amount of time allowing companies to reissue a temporary contract to the same person. Companies abuse the law, she says.

“They are offering temporary contracts to people who are working all the time and should be on permanent employment,” she says. “It’s supposed to be a first step before a permanent job but that’s not what’s happening. It never happens.”

Being employed on a short-term contract made her life difficult. “Everything is more complicated when you don’t have a long-term position, especially in Paris,” Ms Loyen says. “If you want to find an apartment, you have to lie in your application. Everyone does it.”

French entrepreneurs say the costs of terminating permanent contracts are the main reason for using temporary workers.

“Everything that increases flexibility is positive, especially for small companies like us,” says Ludovic Dalle, chief executive in France of Bemyeye, an Italian start-up that sells marketing surveys.

Mikael Sala, founder of Vital, a security systems company, says small business owners would “only hire someone permanently if they had a gun pointed at them”.

Last summer, his 12-staff company nearly went bust after a big contract suffered a nine-month delay, wiping out half of its annual sales. Cash-strapped, he was forced to lay off two of his employees.

“That took me ages and cost me €50,000 to terminate their contracts, and I did not have any money in the coffers, I was on the brink of collapse,” he says. “It was a catch-22 situation. Fortunately banks didn’t let me down. Now, I am extra careful before hiring someone full time.”

Instead, Mr Sala uses subcontractors. Emeric Ribaud, a 30-year-old carpenter, became self-employed about 18 months ago after losing the sight of one eye in an occupational accident.

“It’s physically harder, morally harder, but I take pride in completing work from A to Z on my own terms,” he explains.

The flip side is that Mr Ribaud has not taken a day off since starting. He does not count his hours and says he will start saving for his retirement later. “I know it’s not politically correct to say that in France,” Mr Dalle says. “But it’s better to work in precarious jobs than not work at all.”