The most serious structural flaws concern high payroll taxes and labor-market regulation, which make it difficult – or at least prohibitively expensive – for firms to reduce their workforce when business conditions worsen. The OECD reports that in 2010, France’s “tax wedge” (income taxes plus employee and employer social-security contributions minus cash transfers as a percentage of total labor costs) was at least 13 percentage points above the OECD average at every level of household income.