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Founded in Geneva in 1996 under the auspices of the Council of Europe, FEDRE has always focused on cross-border regions. In 2023, it formed a partnership with Crédit Agricole next bank to study the border effect along Switzerland’s periphery in various fields, some of which go unnoticed by the general public. Following the first issue, which addressed food aid, the Founded in Geneva in 1996 under the auspices of the Council of Europe, FEDRE has always focused on cross-border regions. In 2023, it formed a partnership with Crédit Agricole next bank to study the border effect along Switzerland’s periphery in various fields, some of which escape the attention of the general public. Following Issue 1, which addressed food aid; Issue 2, which explored challenges in the healthcare sector; Issue 3, which presented a vital topic for our regions—water; Issue 4, focused on culture; Issue 5, addressing the sensitive issue of who compensates unemployed cross-border workers; Issue 6 focused on the idea of creating a cross-border resident card, Issue 7 addressed sustainable mobility in cross-border urban areas, this issue is devoted to the European aspects of cross-border cooperation, Issue 8 is devoted to the European aspects of cross-border cooperation, Issue 9 to the diversity of direct taxation systems for cross-border workers, and in this Issue 10 we will see that Switzerland—to its advantage—does not count the unemployed in the same way as its neighbors.
Envied by all, Switzerland’s full employment serves as a model… and some cross-border workers even believe they might owe their situation to it. But this is a false impression. We’ll see why.
When the criteria for calculating the unemployment rate differ
In France, the National Institute of Statistics and Economic Studies (INSEE) uses the criteria of the International Labour Organization (ILO)—which happens to be based in Geneva—in its unemployment rate data, a fact that adds a certain irony when one reads what follows.
Globally, the ILO (and thus INSEE in France) estimates the number of unemployed people by conducting surveys of representative samples of the population, and counts as unemployed those who did not work at all during the past week but who nevertheless report being available to take a job within two weeks, who looked for work in the previous month, or who have found a job but have not yet started it (the future job must begin within the following three-month period).
In contrast, official unemployment statistics in Switzerland, which are produced by the State Secretariat for Economic Affairs (SECO), count only those who are officially registered with the various Regional Employment Offices (REOs). Compared to French statistics from INSEE and international statistics from the ILO, this obviously excludes all those who are not registered as job seekers but who are nevertheless looking for work, more or less actively, and who would be willing to take a job if they found one that suited them. This category includes, in particular, unemployed individuals who have exhausted their benefits.
Switzerland is, of course, familiar with the ILO data, and these figures can be found… not at SECO, but at the Federal Statistical Office (FSO), which publishes a quarterly report covering the entire country. However, it is SECO’s figures that are considered “official” and are the ones people have grown accustomed to citing in public debate. However, there is a significant discrepancy with the ILO figures, which are used by all neighboring countries—a discrepancy that puts Switzerland in a favorable light in international comparisons when official unemployment figures for the country are cited, without noting that they are calculated on a different and more restrictive basis.
From one to two
In the spring of 2024, France had an unemployment rate of 7.3%; Germany, which is often cited in France as a model, stood at 3.2%; while Switzerland proudly reported a rate of 2.3%… though calculated using its own method, that of SECO, which counts only those registered as unemployed.
In fact, according to the statistics published every three months by the FSO using the ILO (and INSEE) methodology, Switzerland’s unemployment rate stood at 4.2% in June 2024, not 2.3%.
According to SECO, the unemployment rate in Geneva—which rose by 0.5% year-over-year, a worrying trend—stood at 4.3% in July 2024, compared with 3.6% in the canton of Vaud, 3.1% in Basel-City, 2.4% in Valais, and 1.8% in Basel-Landschaft. Extrapolating the differences observed nationally between the two systems would suggest an unemployment rate in Geneva of approximately 7.8%, but if we are to believe the cantonal statistics published by the Cross-Border Statistical Office based on ILO data, it would be close to 10%, a figure higher than the French average, and quite significantly above the figures for the neighboring regions of Ain and Haute-Savoie, which have rates of 5.7% and 5.5%, respectively.
Are cross-border workers at risk?
At this point, the cross-border worker reading these lines—who benefits from Geneva’s dynamic economy, which creates well-paying jobs—may begin to feel uneasy, realizing that his situation depends on a region where the unemployment rate is comparable to that of France as a whole, and even higher than in his home department, evenwhile they know that dismissal procedures are significantly easier to initiate in Switzerland than in their home country.
But he can rest assured! The problem of high unemployment in Geneva is not due to a severe shortage of job creation. On the contrary (and cross-border workers know this all too well), Geneva creates many jobs—more than it can fill—which means its economy is constantly in need of an external workforce.
What does characterize Geneva, however, is a high rate of structural unemployment, stemming from a relative mismatch between a segment of the population—which lacks sufficient training or has the wrong skills—and the types of jobs, often highly skilled, that the economy requires. This gap is particularly wide in certain sectors (such as healthcare), which hire a large number of cross-border workers. But Geneva struggles to fully grasp the issue. And rather than investing heavily in training—which is costly and yields results only in the long term—it prefers, often without really admitting it, to fall back on the easy solution of drawing from the pool of qualified personnel trained at the expense of the neighboring country. Cross-border workers can therefore rest easy!