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PARIS, Sept 4 Reuters) - France's unemployment rate held steady in the second quarter, according to data on Thursday that was welcomed by Economy Minister Christine Lagarde but greeted more cautiously by economists.

The measure of the jobless rate in the whole of France according to internationally recognised ILO standards stood at 7.6 percent in the second quarter, national statistics office INSEE said.

The rate for the first quarter was revised up to 7.6 percent from a previously reported 7.5 percent.

A separate measure tracking the unemployment rate in mainland France but excluding overseas provinces stood at 7.2 percent, unchanged from the previous quarter.

The data, from a quarter in which French gross domestic product contracted by 0.3 percent, was hailed by Lagarde who saw it as a vindication of government reforms aimed at getting jobseekers back to work more quickly.

"It's a good figure because we have maintained this figure of 7.2 which is the lowest unemployment rate for 25 years," Lagarde told Europe 1 radio.

"I think all those policies aimed at supporting the labour market and putting work back at the heart of the economic equation are working," she said.

A steady decline in unemployment over recent years, partly due to the number of people retiring, has pushed job fears back behind worries over purchasing power for many French households.

However with growth expected to slow to no more than around 1 percent this year, according to the government's own most recent indication, economists cautioned that the situation could deteriorate.

"The second quarter figures are not as bad as expected," said Global Insight economist Diego Iscaro in a note.

"However, it is important to note that employment is normally a lagging indicator, and we believe that it is just a question of time before weaker output growth is translated into a higher jobless rate," he said.

The data showed the rate of employment of people between 15 and 64 years of age maintaining the steady rise in place since mid-2006 to reach 65.1 percent.

The highest rate of unemployment was found among young people, with the 15-24 year age group suffering the highest rate of 19.1 percent.

France reports monthly jobless data compiled according to its own national standards but reports an ILO-harmonised unemployment rate once every quarter.

(Editing by Ruth Pitchford and Victoria Main) Keywords: ECONOMY FRANCE/UNEMPLOYMENT

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