French Unemployment Ticks Above 8%, Putting a Dent in Macron's Economic Legacy

Emmanuel Macron swept into power in 2017 with a promise: bring down France's stubbornly high unemployment rate. He rolled out tax cuts for businesses, loosened rigid labour rules that deterred hiring, and expanded apprenticeships. For a while, it worked. Unemployment fell to a 40-year low in early 2023. Macron, during his re-election campaign, set a goal of reaching near full employment – about 5 percent – by the end of his second term.

That goal is now looking increasingly optimistic.

France's unemployment rate rose to 8.1 percent in the first quarter of 2026, according to statistics agency INSEE. That is its highest level since 2021, when the COVID pandemic was still hammering economies. The rise threatens to tarnish one of Macron's central economic achievements at a time when his broader record has already been strained by high public debt and persistent budget deficits. And the timing is particularly awkward: the presidential election is in 2027, and Macron cannot stand again.

So what went wrong? Labour Minister Jean-Pierre Farandou told Franceinfo radio that an increase was expected given the difficult economic environment, notably the war in Iran. Growth in France, like in much of Europe, has been hit by a series of external shocks over the past year. A tariff dispute with the United States has weighed on exports, while tensions in the Gulf have pushed up oil prices and dampened tourism.

Then there is Macron's own doing. His failed gamble to call snap elections in mid-2024 delivered a hung parliament and triggered a series of cabinet collapses. Business leaders say that has added to the uncertainty facing French companies. "With zero growth in the first quarter, we shouldn't expect miracles on the employment front," said economist Sylvain Bersinger of Bersingeco.

Not everyone is panicking. Bank of France Governor Francois Villeroy de Galhau acknowledged the figures were disappointing but noted that the labour market is now more resilient than in past downturns, such as after the euro zone debt crisis. "During the slowdown after 2012, the unemployment rate was above 10 percent. We shouldn't forget that – now we're around 8 percent," he said. The rate is also still below the previous peak of 10.5 percent reached in 2015 under Socialist President Francois Hollande.

INSEE offered a few mitigating factors. Nearly half of the rise in unemployment over the past five quarters stemmed from a statistical effect linked to a law requiring recipients of minimum welfare benefits to register as unemployed. The agency also noted that the employment rate – the share of the population in work – remains close to a record high, reflecting stronger participation among young people and older workers compared with a decade ago.

Still, 8.1 percent is not 5 percent. And for a president who built his reputation on economic reform, watching that number climb in his final year in office is not the farewell he envisioned. The legacy is not ruined. But it is certainly bruised.