December 1, 2012 in Business

Eurozone unemployment rises

October’s 11.7 percent rate is highest since 1999
Associated Press
 

LONDON – Another month, another record unemployment rate for the economy of the 17 European Union countries that use the euro.

Figures released Friday by Eurostat, the EU’s statistics office, showed that the recession in the eurozone pushed unemployment up in the currency bloc to 11.7 percent in October, the highest level since the introduction of the euro in 1999.

The rise from September’s previous record of 11.6 percent was anticipated after the eurozone returned to recession in the third quarter, commonly defined as two consecutive quarters of negative growth.

Eurostat found that 18.7 million people were out of work across the eurozone, an increase of 173,000 on the previous month and 2.2 million higher than the year before. The wider 27-nation EU that includes non-euro countries such as Britain and Poland had an unemployment rate of 10.7 percent in October and a total of 25.9 million out of work.

“The level of unemployment in Europe remains unacceptably high,” said Jonathan Todd, a spokesman for the European Commission.

Spain and Greece have the region’s highest unemployment rates – both over 25 percent, with youth unemployment levels heading toward 60 percent, a figure that could have a long-term economic and political impact.

“Talk of a ‘lost generation’ of young people now looks like an alarming possibility,” said Andrea Broughton, principal research fellow at the Institute for Employment Studies.

Both countries are in recession and struggling to convince investors, as well as their own people, that they can control their economies. Both, along with a number of other European countries, have introduced tough austerity measures, such as cutting spending and raising taxes, in order to get a handle on their debts.

At present, the five euro countries at the forefront of the debt crisis – Greece, Spain, Italy, Cyprus and Portugal – are in recession. Others could well join them in the months to come.

Germany’s unemployment rate in October was unchanged at 5.4 percent. France’s was steady too, albeit at nearly double Germany’s at 10.7 percent.

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