> ## Content Index
> Fetch the complete content index at: https://businessoi.media/llms.txt
> Use this file to discover other available public pages before exploring further.

# [RÉUNION] The 'Scissors Effect' Hits Employment: Subsidised Contracts Cut by Two-Thirds in Two Years
- URL: https://businessoi.media/en/la-reunion-leffet-ciseaux-frappe-lemploi-les-contrats-aides-divises-par-trois-en-deux-ans-en/
- Published: 2026-08-01T08:43:30.000Z
- Updated: 2026-08-01T08:43:29.000Z
- Description: PEC subsidised contracts collapse from 12,000 to 4,000 between 2024 and 2026 (-67%). The CESER warns of a 'scissors effect' threatening 90,000 welfare recipients and 26% NEET youth.
- Author: Emmanuel TAOCHY
- Tags: La Réunion, emploi, Économie, Finances publiques, Flash de mi-journée, #en

**Réunion's Regional Economic and Social Council (CESER) is sounding the alarm: PEC subsidised employment contracts are collapsing from 12,000 to 4,000 between 2024 and 2026, while social support needs are rising sharply. A 'scissors effect' that is undermining an already stretched employment integration system.**

## Figures that demand attention

The cuts are stark and well documented. PEC (Parcours Emploi Compétences) subsidised contracts fall from **12,000 in 2024** to **10,000 in 2025**, then **4,000 in 2026** — a reduction of **67%** in two years. Green jobs contracts are cut from 700 to just 250\. At the same time, the State's contribution to wage costs drops from **50% to 40%**, and contract duration is capped at 6 months.

The Regional Programme for Integration and Competitiveness (PRIC) is losing approximately **€10 million** in funding, gutting vocational training schemes at the very moment they are most needed.

## A fragile social fabric

These cuts come against a particularly tense social backdrop. Réunion has **more than 90,000 recipients of the RSA** (minimum income support). Among 15-29 year-olds, **26%** are NEET — not in employment, education or training — a rate that far exceeds national averages. Educational attainment remains structurally low: only **22.3%** of people in Réunion hold a higher education qualification, compared with **44%** in mainland France. Illiteracy affects **17%** of adults — almost double the French average.

Against this reality, reducing subsidised contracts does more than trim a budget line — it removes a safety net from thousands of people who have no other pathway into employment.

## The scissors effect: more need, fewer resources

The CESER describes a relentless mechanism: on one side, social support needs are growing under the pressure of rising precarity. On the other, public budgets are shrinking. The two curves intersect — hence the scissors metaphor — creating a gap that neither private businesses nor local authorities can fill in the short term.

For Réunion's businesses, this signal has a concrete implication: pressure on the available skills pool will intensify in low-qualification sectors that are already stretched. Construction, retail, hospitality and personal services are on the front line.

## Why this matters

The stakes go beyond social policy. If Réunion fails to upskill a significant proportion of its youth, the island risks missing the digital and ecological transition — two sectors that will determine its competitiveness for the next 20 years. The message to social partners and institutions is clear: alternative mechanisms must be found before the scissors effect becomes irreversible.

*Sources: CESER de La Réunion, Journal.re, Zinfos974, INSEE Regional Economic Outlook Q1 2026.*