Emmanuel Macron was in his element on Monday as he used the splendour of the Versailles Palace to court global chief executives and present France as a country transformed by his pro-business reforms.
A slew of recent investment pledges, including one he negotiated directly with SoftBank boss Masayoshi Son to spend up to €75bn on AI data centres, did “not happen by chance”, Macron insisted. “It is the result of reforms, of hard work as well, of consistency, and of our collective commitment.”
But behind the glitz of his annual Choose France summit — and less than a year before a highly uncertain presidential election to succeed him — Macron’s economic legacy is under a microscope.
Rising unemployment, a contracting economy and one of the highest government debt burdens in the Eurozone threaten to tarnish the legacy of the president who swept into office in 2017 on the promise of transforming France into a “start-up nation”.
“Macron embodies the idea of being right versus getting it right,” said Ludovic Subran, chief investment officer at Allianz. “He was completely right on what should be done on labour, tax, attractiveness, manufacturing, but he also made policy mistakes that sabotaged his efforts.”
There are growing doubts among French executives over how much of Macron’s pro-business push, so tied up with the former Rothschild banker’s personality, will survive his departure, especially if the far-right Rassemblement National party succeeds him.
If elected, the eurosceptic RN, which now leads in the polls, would probably unpick some measures to espouse a more state-driven, tax-and-spend approach.
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Business leaders, especially foreign ones, have been flattered by Macron’s personal approach, often handing out his mobile number and taking selfies with them.
During his time in office, Macron has loosened labour rules to make it easier for businesses to cut employees. He created a flat tax on investment income and lowered France’s corporation tax from 33.3 per cent to 25 per cent so that it is more in line with European peers.
But business failures recently reached levels not seen since the 1990s. Macron’s pro-business reforms have also not helped the country to recover export market share. Nor has it restored its external accounts.
“Macron speaks a language business bosses and international decision makers love. He projected an image of France that even went beyond the reality,” said one senior French board member, describing Choose France as the “pinnacle of Macron mania for big international CEOs”.
Macron has delivered growth but it has largely been subsidised by additional public debt rather than structural improvement to the economy.
Since 2017, France’s real GDP has grown at 9.1 per cent, slower than the EU average of 11.4 per cent, but ahead of Germany’s 2.4 per cent and Italy’s 7.8 per cent.
Most of Macron’s reforms came early in his presidency before successive crises slowed momentum. Government paralysis set in after he was re-elected in 2022 but lost his parliamentary majority. Political gridlock worsened after his disastrous decision to call a snap election in 2024.
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Since then Macron’s fragile minority governments have unpicked some of his central reforms to avoid being toppled by the opposition. A hard-fought increase to the retirement age from 62 to 64 was abandoned — the only meaningful spending reform of his second term.
To help plug the deficit, companies with domestic revenue of over a billion euros have been forced to pay a controversial tax surcharge since 2024, reversing seven years of fiscal stability championed by Macron. For aerospace group Safran, its effective corporate tax rate rose back to 32 per cent.
Companies say they still face a thicket of red tape. Sami Slim, who heads the French unit of Japanese data centre group Telehouse, said a plan announced at Choose France in 2024 to build four new data centres was running two years behind schedule. Slow permitting and delays getting connected to the electricity grid only improved when Macron’s office got involved.
“After convincing us [to invest] we were a bit left to our own devices . . . and we came up against all the usual French ills,” Slim said.
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One of Macron’s goals was to end decades of chronic unemployment by bringing it down to 5 per cent. He capped penalties against employers in labour tribunals and trimmed unemployment benefits. Subsidies for apprenticeships were increased to get more young people into work.
Initially the unemployment rate fell, continuing a trend that began under Macron’s predecessor François Hollande, going from 9.5 per cent in 2017 to 7.1 per cent in 2023.
But then progress reversed amid weaker GDP growth and higher interest rates. In the first quarter of this year, unemployment reached 8.1 per cent. Despite the billions spent on apprenticeships, youth unemployment remains stuck at 21 per cent.
Finance minister Roland Lescure told the FT that some of the uptick was caused by a new statistical method that added people on France’s minimum-income welfare benefit to the rolls.
He argued that Macron’s reforms have worked given that the employment rate is at historical highs of 75.5 per cent.
“There has been a major shift in French people’s relationship with work, such that today more young people are working than ever before and more seniors are also working, and for longer,” said Lescure. “We have made progress but obviously we have to go further.”
A lower share of France’s working-age population remains employed than in neighbouring countries, however. Germany’s employment rate stands at roughly 80 per cent, while the Eurozone average is 76 per cent.
The progress in France looked good when “looked at in a silo”, said Olivier Redoulès, an economist at research institute Rexecode. But in reality it just meant the country was approaching the European mean, not outperforming. “In the end, on employment Macron has a mixed record.”
Macron has not tackled high social charges that employers pay on top of salaries, which increase the total cost of taking someone on by 25 to 40 per cent and create a large gap with workers’ take-home pay.
Pierre Bellagambi, the founder of Qista, a small company that makes mosquito traps, said the cost of labour remained a problem: “It hurts us on export markets where consumers just compare on price.”
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Macron has also sought to revive French industry and create better-paid jobs by backing sectors such as cars and aerospace while attracting new ones, including data centres.
Almost one-third of a €100bn pandemic stimulus package was allocated for industry, including green technologies. Macron also threw support behind an expansion of the French nuclear fleet, casting its cheap, carbon-free electricity as a key boost to industry.
The push has yielded some results but boosting industry remains an uphill battle. It is not necessarily down to policy mis-steps. France, like its EU neighbours, faces competition from export powerhouse China and the US.
In 2000, 4.1mn people were employed in industry, before steep declines took hold. The number of industrial jobs stopped falling in 2017 and stabilised at about 3.3mn last year, according to the country’s statistics office Insee. The share of industrial output in GDP has also held steady to hover around 13.5 per cent.
Further progress may depend on whether the French car industry survives the Chinese onslaught. Renault has already closed some assembly lines in France, while rival Stellantis, which owns Peugeot, has pivoted to the US.
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Economists and opposition politicians argue that Macron’s biggest economic failure is the degradation of public finances during his presidency.
The “explosion of public debt”, from €2.01tn in 2017 to €3.5tn last year, would be Macron’s true economic legacy, said Bruno Cavalier, chief economist at financial group Oddo.
“His successor will inherit a mess and hopefully that will give impetus for real reforms, albeit unpopular ones,” Cavalier said.
France’s debt-to-GDP ratio stood at 115 per cent last year, trailing only Greece and Italy. The budget deficit was 5.1 per cent of national output in 2025, far from the 3 per cent ceiling under EU rules.
The causes are multiple: unfunded tax cuts, overgenerous aid programmes, and a refusal to limit inflation-linked increases to pension benefits.
Few real attempts have been made to scale back social welfare, which eats up one-third of all government spending. Macron instead bet it all that supply-side reforms would solve the debt problem via stronger growth and companies, a strategy that did not pan out.
Repairing public finances will require cutting pensions spending and keeping more people in employment, economists say. Yet such moves face broad public opposition so will be difficult for a future president to tackle.
“Macron came to power at a time when there was a broad consensus in favour of reform,” said Redoulès of Rexecode. “Today, there is almost an anti-reform consensus, which isn’t entirely his fault, but will plague his successor.”
