BRUSSELS – The 18-country eurozone may have emerged from recession last year, but that has done little good to the jobs market, with unemployment stuck near a record high since then.
A new report on Tuesday showed that while the number of jobless in the currency union dipped in February, the unemployment rate remained at 11.9 per cent — where it has been since October after peaking at 12.1 per cent earlier in the year.
The figures, published by the Eurostat statistical agency, illustrate how long it will take for the continent’s hardest-hit countries to return to economic health after years of financial upheaval.
“The figures suggest that the economic recovery is still too weak to make a significant dent in the high level of unemployment,” said analyst Jonathan Loynes of Capital Economics.
The situation varies wildly from country to country.
While Germany continues to enjoy a low jobless rate of 5.1 per cent, countries that had to make spending cuts to reduce debt are still suffering.
Spain has the bloc’s highest rate alongside Greece — at 25.6 per cent, down only slightly from 25.8 per cent in January. Italy’s labour market is in fact worsening — unemployment rose to a record 13 per cent from 12.9 per cent a month before.
Overall, the number of unemployed in the eurozone dropped, but only by 35,000, leaving almost 19 million still out of work.
In the wider 28-nation EU — which includes members like Britain and Poland that don’t use the euro currency — the unemployment rate dipped to 10.6 per cent from 10.7 per cent in January.
Experts say joblessness is likely to take some time to come down. Businesses are still wary of hiring and investing after worrying about a global recession in 2008-2009 and the potential collapse of the eurozone after that. There is also mounting concern over low inflation, which raises the risk that consumers might put off spending in hopes of discounts later on.
The eurozone’s economy is not growing quickly enough to bring confidence back.
The European Commission, the EU’s executive arm, predicts the eurozone economy will pick up and grow 1.1 per cent this year. While that would be the bloc’s best performance since 2011, it would still pale in comparison to the U.S. economy, which is expected to grow around 3 per cent.
“Unemployment remains worryingly high … and seems unlikely to come down markedly any time soon given the probably gradual recovery,” said Howard Archer, an analyst with IHS Global Insight.
That bodes ill for the young, the demographic that has been hit hardest by the recent financial crisis. The eurozone unemployment rate for those under the age of 25 dropped only slightly in February to 23.5 per cent from 23.6 per cent in January.
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