Unemployment at record high across the eurozone

Posted on January 31, 2012

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written for New Statesman – words by Robert Pollard

Unemployment figures increase as debt crisis continues to engulf the region.

According to the Eurostat agency, unemployment across the eurozone hit record levels at the end of 2011, with the jobless rate standing at 10.4 per cent at the end of December.

With 16.5 million people across the 17 single currency countries unemployed, an increase of 751,000 on the 2010 figures, it represents the worst unemployment levels since the euro was launched in 1999.

Spain has the highest rate, with 22.9 per cent of people out of work, while Austria has the lowest with 4.1 per cent unemployed. The debt crisis that has flooded the region has seen unemployment rise steadily throughout 2011 and the problems show little sign of abating.

Employment difficulties extend to the EU, with 23.8 million (9.9 per cent) unemployed across the 27 EU nations.

Citigroup economist Guillaume Menuet believes that 2012 will see further job losses across the Europe:

If you think about the direction of employment expectations that you see across various business surveys, the outlook for employment doesn’t look particularly enticing, simply because the uncertainty is very high.

In many cases you find firms continuing to delay investment projects. For those that are still making profits, hiring is being frozen, and for those which are under pressure to hit results or losing money, job losses are becoming the only solution that they have.

These disappointing figures will raise further questions about the suitability of austerity measures in times of economic uncertainty. Many economists believe reductions in government spending is the least effective way of dealing with a debt crisis and the figures released today will likely reaffirm those beliefs.

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Posted in: Politics