France must accelerate reform pace: Business leaders

France much accelerate reforms: Lobbyist
France much accelerate reforms: Lobbyist
French situation not really taking off: Dep. CEO
French situation not really taking off: Dep. CEO
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How French unemployment impacts Adecco
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France not sick man of Europe: Gurria

CEOs worldwide may be eyeing China right now, but European business leaders are also concerned about rumblings in an economy closer to home.

France's economy has struggled to gather pace and this week, French Prime Minister Manuel Valls promised to step up the pace of economic reforms and make the French labor market more flexible.

August's flurry of economic data shows an ongoing recovery, but one that lacks strong momentum. The INSEE business climate index showed that confidence inched higher in August, while the Markit purchasing managers' index (PMI) showed business activity continuing to rise, but at a slightly slower rate than in the previous month.

Data out on Wednesday showed that France's stubbornly high unemployment level crept lower in July. But economic growth flatlined in the second quarter.

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Jad Ariss, deputy CEO of AXA France, termed August's data "disappointing" and said France was failing to fully realize the benefit of low oil prices, the weak euro and low interest rates from the European Central Bank.

"In spite of these elements, the French situation is not really taking off and this is preoccupying," Ariss told CNBC from the annual conference of the MEDEF business lobbying group in Jouy-en-Josas, France on Thursday.

People stand in line to enter a job fair in New York.
John Moore | Getty News Images | Getty Images

Ariss and other business leaders at the conference emphasized the need for France to press on with long-awaited reforms, particularly with regards to labor markets. Although the government of Francois Hollande has made some efforts to make hiring and firing employees easier, labor mobility in France is hindered by strong employee protection and a complex labor code.

"I clearly believe that if we want to accelerate the growth of the country, we need to accelerate the reforms," Jean-Louis Chaussade, CEO of French utility firm, Suez Environnement, told CNBC on Wednesday.

Back in March, the Organisation for Economic Cooperation and Development (OECD) said that France's key challenge was to reform the labor market to promote job growth.

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Some progress has been seen in terms of reforms regarding mass layoffs and the introduction of the rupture conventionnelle, a mutually agreed termination process.

On Thursday, MEDEF President Pierre Gattaz urged the government to "accelerate on the basic reforms," but expressed optimism overall about the French economy.

"I think it's time to invest in France, because we are like a company which is in recovery," he told CNBC on Thursday.

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Despite the flat growth between April and June, Gattaz forecast that French economy could expand by up to 1.2 percent in 2015. This is in line with the latest official forecast of 1.1 percent growth from the European Commission.

Bruno Lafont, honorary chairman of building materials giant Lafarge Holcim, told CNBC he was "not optimistic"—but still thought the French economy was on the right path.

"Of course we are always worried that it is too slow and that not all the positive signals are given to create and to restore the confidence. But, yes I'm quite - not optimistic - but thinking that we are going in the right direction. The question is the timing of the acceleration of the recovery," he said on Wednesday.

—By CNBC's Alexandra Gibbs, follow her on Twitter @AlexGibbsy.