By: Dr. Mike Campbell
Employment always lags behind the recovery after an economic recession since companies need to have plenty of evidence of demand before they engage new staff. The global economic recovery is underway, but it is universally described as “fragile” and “modest”. So far, there has been no significant upturn in employment in any of the world’s major economies and most are still bleeding jobs; although the rate of haemorrhage has slowed. It is therefore unsurprising that the latest Eurostat figures show that unemployment within the 16 countries which have adopted the Euro has risen to a new record level. Within the zone, unemployment stands at 10.1% which equates to almost 15.9 million people who are without work. In the wider European Union, the figure is marginally better with 9.7% of the workforce (or 23.3 million people) currently idle.
The level of unemployment across the EU is quite heterogeneous with the worst level being seen in Latvia (22.5%) which is not a Eurozone country and the best being Eurozone member, the Netherlands at 4.4%. Within the Eurozone, the biggest unemployment problem is to be found in Spain where almost one in five of the workforce is unemployed, but figures for Slovakia and Ireland also make grim reading.
The Economic powerhouse of the European Union is Germany and it is perhaps significant that Germany was the only nation to record a fall in unemployment over the past twelve months. With the Euro at a four year low against the Dollar and at its lowest value against Sterling in a year, Eurozone exports may see a boost which could spur the recovery. However, there has been such volatility in the value of all the major currencies recently that it is hard to be sure if the trend will continue long enough to produce a real effect.