Unemployment in Europe Remains Stubbornly High
By DAVID JOLLY
Published: January 8, 2014
PARIS — Europe’s labor market remained stagnant in November, official data showed Wednesday, suggesting the region’s economy will continue treading water in the new year.
The unemployment rate in the euro zone remained at 12.1 percent, a level it has held since April, Eurostat, the European Union’s statistics agency, reported from Luxembourg.
The jobless rate was in line with economists’ expectations. It had risen from just under 10 percent in early 2011 to the current record level. Eurostat had previously reported that the rate hit 12.2 percent this summer, but that figure has been revised.
For the full European Union, made up of 28 member states, the jobless rate was unchanged at 10.9 percent. Eurostat estimated that 26.6 million across Europe were unemployed and seeking work, 19,000 more than in October.
More than five years after the global financial crisis erupted, Europe’s economy remains on fragile footing. Consumers are wary of spending, lending to businesses is contracting, and investment, not surprisingly, is weak.
Richard Barwell, an economist in London with Royal Bank of Scotland, estimated before the jobless data were released that the euro zone’s gross domestic product grew by just 0.2 percent in the fourth quarter of 2013. That would be equivalent to a 0.8 percent annualized rate.
Mr. Barwell forecasts that the euro zone will manage quarterly growth of about 0.3 percent in the first quarter of the new year.
There have been some hopeful signs in Europe lately, including a survey of purchasing managers by Markit Economics, which showed output near the highest it has been for two-and-a-half years. Ireland met strong demand upon its return to the international bond market Tuesday after exiting its bailout.
Among the lowest unemployment rates in Europe were in Austria, with 4.8 percent, and Germany, with 5.2 percent. Among the highest was Spain at 26.7 percent. In Greece, which is several months behind in its reporting, the rate was 27.4 percent.
There were 17 euro zone members for the period when the data were tabulated. Eurostat will begin including information for the newest member, Latvia, which joined at the start of the year, in the January data.
The report arrived on the eve of a policy meeting of the European Central Bank’s Governing Council. The central bank in November surprised markets by cutting its benchmark interest rate to 0.25 percent from 0.5 percent, and economists say it is too soon to expect the bank to move on rates again this week.
But the jobless data, and the danger of deflation, will be important topics for discussion in Frankfurt. Consumer prices in the euro zone rose in December at an annual rate of only 0.8 percent, Eurostat reported on Tuesday — far below the E.C.B.'s inflation target of 2 percent.
By DAVID JOLLY
Published: January 8, 2014
PARIS — Europe’s labor market remained stagnant in November, official data showed Wednesday, suggesting the region’s economy will continue treading water in the new year.
The unemployment rate in the euro zone remained at 12.1 percent, a level it has held since April, Eurostat, the European Union’s statistics agency, reported from Luxembourg.
The jobless rate was in line with economists’ expectations. It had risen from just under 10 percent in early 2011 to the current record level. Eurostat had previously reported that the rate hit 12.2 percent this summer, but that figure has been revised.
For the full European Union, made up of 28 member states, the jobless rate was unchanged at 10.9 percent. Eurostat estimated that 26.6 million across Europe were unemployed and seeking work, 19,000 more than in October.
More than five years after the global financial crisis erupted, Europe’s economy remains on fragile footing. Consumers are wary of spending, lending to businesses is contracting, and investment, not surprisingly, is weak.
Richard Barwell, an economist in London with Royal Bank of Scotland, estimated before the jobless data were released that the euro zone’s gross domestic product grew by just 0.2 percent in the fourth quarter of 2013. That would be equivalent to a 0.8 percent annualized rate.
Mr. Barwell forecasts that the euro zone will manage quarterly growth of about 0.3 percent in the first quarter of the new year.
There have been some hopeful signs in Europe lately, including a survey of purchasing managers by Markit Economics, which showed output near the highest it has been for two-and-a-half years. Ireland met strong demand upon its return to the international bond market Tuesday after exiting its bailout.
Among the lowest unemployment rates in Europe were in Austria, with 4.8 percent, and Germany, with 5.2 percent. Among the highest was Spain at 26.7 percent. In Greece, which is several months behind in its reporting, the rate was 27.4 percent.
There were 17 euro zone members for the period when the data were tabulated. Eurostat will begin including information for the newest member, Latvia, which joined at the start of the year, in the January data.
The report arrived on the eve of a policy meeting of the European Central Bank’s Governing Council. The central bank in November surprised markets by cutting its benchmark interest rate to 0.25 percent from 0.5 percent, and economists say it is too soon to expect the bank to move on rates again this week.
But the jobless data, and the danger of deflation, will be important topics for discussion in Frankfurt. Consumer prices in the euro zone rose in December at an annual rate of only 0.8 percent, Eurostat reported on Tuesday — far below the E.C.B.'s inflation target of 2 percent.
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