Andrea Broughton, IES Principal Research Fellow, comments:
‘The latest EU unemployment figures show that the overall rate of unemployment in the Eurozone now stands at 11.7% in October 2012, a significant jump from the 10.4% recorded in October 2011. This is the highest level since the introduction of the euro.
‘The unemployment rate in the EU27 now stands at 10.7%, also up significantly from 9.9% in October 2011. Unemployment rates are steadily increasing on a monthly basis, up from the September 2012 rates of 11.6% in the Eurozone and 10.6% in the EU27.
‘Compared with October 2011, the number of unemployed people rose by 2.160 million in the EU27 and by 2.174 million in the Eurozone. There are now 25.9 million people unemployed across the EU.
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‘Unemployment levels have increased over the past 12 months in 16 EU Member States, decreased in nine and remained stable in two (Austria and Slovenia). The highest levels of unemployment are in Spain (26.2%), Greece (25.4% in August 2012). These countries were among those that recorded the highest increases in unemployment over the past year. The largest decreases in unemployment over the past year were recorded in the Baltic states of Estonia, Lithuania and Latvia, indicating that these countries may be weathering the crisis now.
‘Youth unemployment continues to be the main concern for European policymakers, as it continues to rise. The average rate of unemployment under the under-25s in October 2012 in the EU27 is now 23.4% and 23.9% in the Eurozone, compared with 21.9% and 221.2% respectively in October 2011.
‘In Greece, the youth unemployment rate, at 57.0% in August 2012, is now nearer the 60% rather than the 50% mark. Spain is also continuing to struggle with youth unemployment, with the rate in October 2012 reaching 55.9%, up significantly from the 48.3% recorded in October 2011. Youth unemployment levels in Portugal (39.1%) and Italy (36.5%) are also well above the EU average for the under-25s.
‘There seems to be little prospect of either youth unemployment or overall unemployment levels coming down in the foreseeable future, given the continuing economic uncertainty in Europe. Talk of a ‘lost generation’ of young people now looks like an alarming possibility, particularly in those countries where the majority of those under 25 will find it difficult to find work. The European Union is devoting significant resources to improving youth unemployment levels, but this is unlikely to have an impact on the figures for some time. There also seems to be a rather worrying north-south split opening up across Europe, with the labour markets of countries such as Greece, Spain, Italy and Portugal continuing to suffer more than those of their more northerly neighbours.’
