Réunion Island's labour market is sending mixed signals. According to INSEE's economic report for Q1 2026, the BIT unemployment rate in Réunion has reached 18% of the active population, up 2 percentage points from Q1 2025. At the same time, salaried employment remains stable at 294,700 jobs, with annual growth of +0.4%.
A Structural Divide with Metropolitan France
The gap with metropolitan France — where the unemployment rate stands at 8.1% — now exceeds 10 percentage points. Réunion records the second-largest increase in unemployment among all French regions, after French Guiana (+2.7 points). This dynamic is partly explained by the Full Employment Act, which came into force in early 2025 and now includes RSA (welfare) recipients and young people aged 15–29 in official statistics — without a corresponding increase in job creation.
Sectors Under Pressure
Sectoral data reveals the fragilities: construction shed 0.4% of its workforce this quarter, while business services contracted by 1.4% (around 300 jobs). Conversely, non-market services grew by +0.6% and temporary employment picked up (+2.0%, adding 100 jobs). Business creation reached 4,190 in Q1 2026, down 11% from Q4 2025's peak — the latter inflated by the Girardin tax incentive scheme.
Why It Matters
The divergence between stable salaried employment and rising unemployment reflects a surge of new labour market entrants, not job destruction. This is a structural warning signal: Réunion needs to create far more private sector jobs to absorb a growing active population. The island's employment rate (52% of 15–64 year-olds) remains 17 points below the national average — a gap that only narrows across decades.
Sources: INSEE Conjoncture Réunion No. 42, Q1 2026; La Voix de France; France Travail