Unemployment at Record High in Euro Zone
Unemployment in the euro zone rose to a new high in March, according to data released Wednesday which is likely to intensify calls for an easing of the region’s austerity drive.
Unemployment in the 17 countries that belong to the euro zone rose to 10.9 percent in April from 10.8 percent in March, Eurostat, the European Union statistics agency, said Wednesday. In March 2011, the rate was 9.9 percent, a number that illustrates the deterioration of the area’s economy during the last year.
The monthly increase, the 11th in row, translates into more than 17 million jobless people, and is also likely to add to tension ahead of national elections in Greece and France on Sunday.
The votes will be an occasion for citizens to register their discontent at the decline in living standards and public services that has been a consequence of government budget cutting. Leaders could come to power who are unwilling to continue the austerity programs pushed by Northern European countries, especially Germany.
“The grim unemployment figures for March will likely encourage talk about a long-overdue ‘growth pact’ for the euro zone,” Martin van Vliet, an economist at the Dutch bank ING, said in a note to clients.
The figures also illustrated the growing gap between Northern Europe and countries in the south. The jobless rate in Germany was just 5.4 percent as calculated by Eurostat, compared to 24.1 percent in Spain and 21.7 percent in Greece. The Greek figure is based on January data, the most recent available.
However, some economists said there were signs of weakness even in Germany, which has the largest economy in Europe. The Federal Employment Agency, which counts some people as unemployed who are excluded by Eurostat’s methodology, said Wednesday the number of jobless people in Germany fell by 65,000 in April to below 3 million, a rate of 7 percent.
After adjusting for seasonal distortions, though, unemployment in Germany rose slightly.
“Compared with most other European countries, the German labor market is still a bright spot,” Thomas Harjes, an analyst at Barclays Capital, said in a note. But he added, “Today's figures highlight that the weak economy will not leave the labor market unscathed.”