UNLIKE Americans, Western Europeans gloomily expect their unemployment to keep increasing even if an economic recovery arrives. This implacable rise helps explain much that is going on in European politics--most recently the heavy vote against the left in the French municipal elections last weekend. When France's Socialist government came into office nearly two years ago and embarked on a vigorous drive for jobs, the main effect was to weaken the currency. Unemployment is now moving upward again, and the voters don't like it.
The Europeans have built economies that are immensely productive but--for reasons having more to do with social structure than deliberate policy-- rigid and poorly adapted to deal with change. They seem to be incapable of creating new jobs. As employment declines in older industries like steel, it is not being balanced by rising employment in new sectors. In Britain, the peak year for manufacturing employment was 1965. Since then, the number of manufacturing jobs has fallen by one-third, most of it in the past four years. Even in wealthy West Germany, employment in manufacturing has been slowly declining ever since 1970. There has been some growth in the service industries, but not nearly enough to accommodate the numbers of young people now coming into the labor market. The Germans are accustomed to an absolutely stable labor force, and the rise in birthrates in the early 1960s has started a demographic ripple now showing up not in more jobs but in more jobless.
Europeans emerged from World War II with an understandable special craving for security. As their societies got richer, they used their wealth to buy protection against the evils of destitution and hunger. The structure of social benefits and the taxes needed to pay for them now make it fiercely expensive to hire people. Most of the European countries have allowed their wages to go too high, and the protective system makes reductions very difficult. That gives European employers powerful incentives to put their money into labor-saving equipment instead of payrolls.
The extreme examples are Belgium and Holland. Belgium, over the past decade, has achieved increases in manufacturing productivity second only to Japan's among the industrial countries. Holland ranks third. But unemployment in both Belgium and Holland is now 15 percent or more.
The alternative is to weaken, in some degree, the formidable systems of social and economic protection. But that's no more popular in Europe than here. Europe continues to be rich. But in countries governed by right and left alike, incomes are now being sustained by the higher productivity of the employed who are supporting rising numbers of the unemployed.