Hollande says France in state of economic emergency

Under a two-year scheme, firms with fewer than 250 staff will get subsidies if they take on a young or unemployed person for six months or more.

And about 500,000 vocational training schemes will be created.

 

France's unemployment rate is 10.6%, against a European Union average of 9.8% and 4.2% in Germany.

Mr Hollande said money for the plan would come from savings in other areas of public spending.

"These €2bn will be financed without any new taxes of any kind," said President Hollande, who announced the details during an annual speech to business leaders.

He said France was facing an economic emergency and it was time to redefine the country's economic and social model.

'Little expectation'

The President said recently that the country's social emergency, caused by unemployment, was as serious as the emergency caused by terrorism.

However, the BBC's Paris correspondent Hugh Schofield said there was widespread scepticism that the plan would have any lasting impact.

"Despite regular announcements of plans, pacts and promises, the number of those out of work continues to rise in France. 

"With a little over a year until the presidential election in which he hopes to stand for a second term, President Hollande desperately needs good news on the jobs front. But given the huge gap so far between his words and his achievements, there is little expectation that this new plan will bear fruit in time", our correspondent said.