French Unemployment Hits Highest Level Since 2020

France’s unemployment rate rose to 8.3% in the second quarter of 2026, its highest level since the third quarter of 2020. The number of unemployed people reached 2.677 million, increasing by 62,000 over the quarter and 261,000 over the year. Employment declined, long-term unemployment increased and private-sector payrolls were almost 80,000 lower than a year earlier. Groups affected by the France Travail reform account mathematically for part of the deterioration, but INSEE’s data do not support treating the increase as a purely statistical effect.

Unemployment rose to 8.3%

France’s National Institute of Statistics and Economic Studies said on August 7 that the ILO unemployment rate increased by 0.2 percentage point from 8.1% to 8.3% in the second quarter. It was 0.7 point higher than a year earlier.

The detailed INSEE table puts the number of unemployed people at 2.677 million. The total rose by 62,000 during the quarter and by 261,000 from a year earlier. INSEE estimates the unemployment rate and its quarterly movement with an uncertainty of approximately ±0.3 percentage point.

The rate was the highest since the third quarter of 2020, which was heavily distorted by the pandemic. Excluding that episode, similar levels were last seen in 2019. The current rate nevertheless remains 2.2 percentage points below the second-quarter 2015 peak.

Youth unemployment reached 21.6%

Unemployment increased across all major age groups.

For people aged 15 to 24, the rate rose by 0.4 percentage point to 21.6%, an increase of 2.5 points from a year earlier. Approximately 740,000 young people were unemployed.

For those aged 25 to 49, unemployment increased to 7.5%, its highest level since the first quarter of 2021. Among people aged 50 and above, it rose to 5.5%, the highest since early 2022.

The deterioration therefore cannot be attributed solely to young workers or a single part of the economy.

Long-term unemployment is increasing

Approximately 671,000 people had been without work and seeking employment for at least one year.

That was 36,000 more than in the previous quarter and 116,000 more than a year earlier. The long-term unemployment rate rose to 2.1% of the labour force, its highest level since the second quarter of 2022.

Persistent long-term unemployment is particularly important because prolonged periods outside employment can weaken skills and make re-entry into work more difficult.

The employment rate fell to 69%

The employment rate among people aged 15 to 64 decreased by 0.3 percentage point to 69.0% and was 0.5 point lower than a year earlier.

Youth employment fell to 33.8%, the rate for people aged 25 to 49 declined to 82.4%, and that for people aged 50 to 64 fell to 69.1%. All three groups recorded year-on-year declines.

Among people aged 60 to 64, however, employment increased by 1.2 percentage points over the year to 45.8%.

Labour-force participation remains historically high

France continues to record a very high activity rate.

The proportion of people aged 15 to 64 participating in the labour market was 75.4% in the second quarter, just below the record 75.5% reached in the first quarter. The series dates back to 1975.

Participation remains 2.7 percentage points above its end-2019 level. Among people aged 55–64 it reached 65.9%, while among those aged 60–64 it stood at 48.7%.

This matters because unemployment can increase when labour-force participation rises faster than job creation, even without a dramatic wave of layoffs.

France Travail has changed the composition of the labour force

France’s Full Employment Act introduced systematic France Travail registration from early 2025 for groups including RSA recipients and their partners, young people supported by local youth missions and some people with disabilities.

Registration with France Travail is not equivalent to ILO unemployment. Under the ILO definition, a person must be without work, actively seeking employment and available to start.

INSEE therefore separately tracks how groups targeted by the reform contribute mathematically to labour-market indicators.

Two targeted groups account mathematically for almost half the increase

From the end of 2024 through the second quarter of 2026, France’s unemployment rate rose by about 0.98 percentage point.

Households including an RSA recipient contributed approximately 0.31 point, while people aged 15–29 registered with France Travail and not in the RSA group contributed another 0.11 point. Their combined contribution was therefore approximately 0.44 point.

INSEE explicitly warns that these are mathematical contributions rather than estimates of the law’s causal effect. The calculation cannot distinguish reform effects from cyclical deterioration affecting the same groups.

It would therefore be incorrect either to attribute the entire unemployment increase to economic weakness or to claim that almost half of it exists only because of statistical reclassification.

RSA households remain particularly vulnerable

Among economically active people belonging to households receiving RSA, unemployment reached 48.6%.

The rate was 7.9 percentage points higher than at the end of 2024. Their employment rate simultaneously fell to 24.5%.

This explains why bringing groups with weak labour-market attachment more fully into the employment system can materially affect headline indicators.

INSEE expanded the geographical scope to Mayotte

From this release onward, INSEE’s main labour-market indicators cover all of France, including Mayotte. Earlier quarterly series used France excluding Mayotte. Historical data have been backcast to preserve comparability.

Including Mayotte raises the second-quarter unemployment rate by approximately 0.06 percentage point and lowers the employment rate by around 0.17 point. After rounding, however, the headline unemployment rate remains 8.3% and its quarterly increase remains 0.2 point.

The geographical change therefore explains only a very small part of the latest level.

Private payrolls fell by 19,300 jobs

Separate payroll data confirm genuine labour-market weakness.

Private payroll employment declined by 19,300 jobs, or approximately 0.1%, between March and June. The first quarter had already recorded a decline of 13,900 jobs.

Compared with the second quarter of 2025, private employment was down by 79,700 jobs, or 0.4%. It was the sixth consecutive quarter of year-on-year decline.

Construction lost about 6,100 jobs during the quarter, industry excluding temporary work lost 3,200, while market services including temporary workers declined by 9,700.

Private payroll employment nevertheless remains about one million jobs above its end-2019 level, showing that the current development is a cooling from a stronger post-pandemic market rather than a return to crisis conditions.

GDP grew by only 0.2%

The deterioration is taking place against weak economic growth.

French GDP expanded by 0.2% in the second quarter after contracting by 0.1% in the first. Household consumption increased by 0.2%, but gross fixed capital formation fell by another 0.3%.

Foreign trade contributed 0.6 percentage point to growth, while inventory changes subtracted 0.6 point. Final domestic demand excluding inventories added only 0.1 point.

The figures do not indicate a deep recession, but domestic investment and demand remain too weak to generate rapid job creation.

France remains well above the euro-area unemployment rate

For international comparisons, harmonised monthly Eurostat figures are preferable to mixing a French quarterly rate with euro-area monthly data.

In June 2026, France’s harmonised monthly unemployment rate was 8.2%, compared with 6.3% for the euro area and 6.0% for the European Union.

Youth unemployment was 21.1% in France, compared with 14.8% in the euro area and 15.5% across the EU.

These figures differ slightly from INSEE’s quarterly rates of 8.3% and 21.6% because the series use different frequencies and compilation procedures.

The European Commission expects further deterioration

The European Commission forecasts an average unemployment rate of 8.3% in 2026 and 8.7% in 2027.

Payroll employment is forecast to fall by 0.4% this year and by another 0.1% in 2027. Meanwhile, the labour force is expected to grow by 0.7% and 0.6%, respectively.

Real GDP growth is projected at only 0.8% in 2026 and 1.1% in 2027. Aeronautics and defence exports are expected to support activity, while higher energy costs weigh on domestic demand.

Higher unemployment adds to France’s fiscal problem

France also has limited room to offset weaker employment through fiscal expansion.

The European Commission forecasts a government deficit of 5.1% of GDP in 2026. Public debt is projected to rise from 115.6% of GDP in 2025 to 118.1% in 2026 and exceed 120% in 2027 under unchanged policies.

Higher unemployment can weaken tax and social-contribution revenue while increasing expenditure on benefits and labour-market support.

As International Investment experts report, France’s rise in unemployment to 8.3% cannot be reduced to a single explanation. The France Travail reform has materially changed the composition of the measured labour force and increased the statistical weight of groups with exceptionally high unemployment, but falling employment rates, declining private payrolls and rising long-term unemployment confirm genuine cooling. The principal risk is the combination of weak economic growth, an expanding labour force and constrained public finances. Unless job creation accelerates, the European Commission’s forecast of 8.7% unemployment in 2027 appears increasingly plausible.