Jobless rate in eurozone at record level

January 09, 2014 - 12:00:00 am

BRUSSELS: Eurozone unemployment continued near record highs in November at 12.1 percent but there were signs the bad times may be easing as the debt crisis peaks out, analysts said yesterday.

They said other data, notably a sharp improvement in retail sales, suggest the economy could be holding its own again after a soft patch but progress would remain slow.

The eurozone jobless rate came in at 12.1 percent in November, unchanged from October, while retail sales rose 1.4 percent by volume, more than reversing a fall of 0.4 percent in October, the Eurostat statistics agency said.

There were about 19.24 million jobless in the eurozone in November, up 4,000 from October but soaring by 452,000 compared with November 2012 as the debt crisis pushed the economy into a deep recession.

Eurozone unemployment hit a record 12.2 percent in September but this figure was subsequently revised down to 12.1 percent.

The unemployment figures show that the “labour market downturn is starting to ease,” said James Howat of Capital Economics.

“Although the number of jobless rose slightly (4,000), this only partially reversed October’s large fall,” Howat noted.

“Looking forward, survey measures of employment intentions suggest that eurozone employment might start expanding again over the coming quarters, albeit at a slow pace.” Howat said that the retail sales figures easily beat forecasts for a November gain of 0.3 percent to put them at the highest rate since early 2011.

That is evidence “that pressure on households is slowly easing,” he said. “Overall, the outlook is starting to brighten a little for eurozone consumers.”

Christian Schulz at Berenberg Bank said that unemployment figures typically lag six months behind improvements elsewhere and the latest report pointed to gradual progress.

“The Eurozone’s modest economic recovery, which began in the spring of 2013, is gradually helping to stabilise the labour market,” Schulz said. 

He described the figures as “broadly stable,” while the retail sales data after two monthly declines brings “the series back to its stable trend.”

However, unemployment “remains extremely high in most crisis countries,” Schulz said, and while labour market reforms could help, it “will take a very long time to return to more normal job market conditions.”

In the 28-member European Union, the unemployment rate was also flat, at 10.9 percent, but the jobless numbers rose 19,000 to 26.55 million in November and were up 278,000 compared with a year earlier, Eurostat said.

The lowest unemployment rates were found in Austria with 4.8 percent and economic powerhouse Germany, 5.2 percent.