Most think Switzerland has low unemployment, however, aggregate figures mask large regional differences. Underneath the overall national rate of 3.5% (February 2015), lie cantonal rates that range from 1.1% in Obwalden to 5.8% in Neuchatel.
Zurich, currently at 3.6% typically hovers around the national average, while Geneva, currently at 5.6% is consistently 2% higher than the national figure. A report put together by a group of university experts1 shows that this 2% difference is persistent and has been around since 1977.
Slow down, take it easy
According to the report, the difference in unemployment rates boils down to the lengthier time it takes the unemployed of Geneva to find new jobs compared to those in Zurich – in Geneva it took 300 days, 20% longer than in Zurich. The canton of Geneva had the highest duration nationally, more than twice the Swiss average of 140 days. The ratio of job seekers to job vacancies is consistently higher in Geneva too – Economists call this relationship a Beveridge curve. It is a measure of labour market efficiency and shows the relative inefficiency of Geneva’s job market.
The report highlights 30 reasons that help to explain regional differences across Switzerland. Some have more impact than others and not all work in the same direction, for example women suffer less discrimination in Geneva than in Zurich but still take longer to find work in Geneva.
So why does it take job seekers in Geneva longer to find work than those in Zurich? Here are the report’s top three reasons.
Different cultural attitudes appear to play a big part in the time it takes to find work. The research finds German speakers are quicker to find their way out of joblessness even when they reside west of the Rösti graben in francophone Switzerland, pointing to differences in culture rather than context.
A clever comparison between the number of people describing themselves as unemployed in the Swiss census and the number officially registered as unemployed, shows big differences between French and German speakers. In Zurich only 39.5% of those describing themselves as unemployed in the census were officially registered as such. In Geneva the percentage was 61.3%. The analysis cites this as powerful evidence that unemployment is considered less socially acceptable in Zurich than in Geneva, giving Zurich residents greater impetus to get back to work.
Furthermore, in 2002 and 2010 a German-speaking majority voted in national initiatives to reduce the size and duration of unemployment payments to fill growing holes in the funds that pay out unemployment benefits. On both occasions a majority of French speakers voted “No”, once again highlighting different cultural attitudes towards unemployment.
Foreigners are associated with higher unemployment and international Geneva is home to a large number. In 2013, 40% of Geneva residents were foreign compared to 25% in Zurich. Foreigners appear no more likely to lose their jobs, however they find it harder to get rehired. The report suggests this is mainly down to poor mastery of languages. Geneva it seems has a higher percentage of people struggling to speak French than Zurich has tongue-tied-wannabe German speakers.
More cross-border workers
High numbers of cross-border workers are associated with higher local unemployment. The report finds that while cross-border workers do not appear to create unemployment, they increase competition for open positions making it harder for local unemployed residents to secure new jobs. In 2013, only 1% of Zurich’s workforce commuted daily from across the border compared to 24% in Geneva.
Ultimately it appears that Switzerland’s unemployment rates are as diverse as its geography, demographics, linguistics and culture.
1Analysis of regional unemployment differences (Yves Flückiger, Pierre Kempeneers, Joseph Deutsch, Jaques Silber, Stephen Bazen – in French)
Federal unemployment figure for February 2015 (SECO – in French)