The Great Recession will leave lasting scars on public finances and on employment. A modest recovery is underway and should allow only a slow retreat in unemployment. Priorities will be to ensure that the public finances do not threaten macroeconomic stability, to improve regulation of the banking system, and to pursue structural reforms that stimulate employment and the productive potential of the economy. Banking supervision seems relatively effective in France and was significantly improved in 2010. However, it is still difficult to assess the real soundness of the financial system. The growth in banking concentration calls for the urgent introduction of a mechanism for monitoring systemic risk. This could lead to stricter capital adequacy requirements in light of the degree of systemic risk posed by each institution, and the development of a mechanism for dealing with failed banks. In the case of a sustained real estate price boom, the authorities should not hesitate to take macro-prudential measures to limit bank lending to households. Turning to the all-important labour market France still has a structural jobs deficit concentrated on younger and older workers. For a decade now, numerous measures have been taken to enhance employment opportunities for older workers, and the 2010 pension reform will help in this regard. Moreover, elimination of the taxe professionnelle, expanded powers for the competition authority, the research tax credit, greater autonomy for universities, future spending on higher education, training and research – all these recent measures speak to the determination of the authorities to boost the supply potential of the economy. In both areas – the labour market and the supply of output – there will have to be a protracted effort in order to overcome the principal weaknesses of the French economy.