Unemployment in Euro Zone at Record High
Unemployment in the euro zone hovered at a record 11.4 percent in August, according to data released on Monday, underscoring the pain inflicted by the slowing world economy and the financial problems plaguing many of the countries that share the euro.
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The jobless numbers, which compare with the August rate of 8.1 percent in the United States, suggest that Europe’s recession is deepening despite the continued efforts of policy makers and finance ministers to cure the region’s malaise.
Unemployment in Greece and Spain, currently the euro zone’s most economically troubled members, reached euro-era highs. And as both countries move ahead with plans for even tougher austerity budgets — Greece to appease its international creditors, Spain to potentially clear the path for European aid — their job outlooks could worsen further.
Greece had an unemployment rate of 24.4 percent in June, the latest month for which data were available. Spain still had the region’s highest jobless rate, at 25.1 percent, and an even bigger problem among young people. Nearly 53 percent of Spaniards younger than 25 were classified as unemployed in August.
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East EU manufacturing dips
Central European manufacturing shrank in September, signaling a deeper than feared recession in the Czech Republic and a slowdown in Poland that economists said authorities should counter with new stimulus measures
in the region's biggest economy, Poland, a collection of dismal new data has spurred Prime Minister Donald Tusk to begin drawing up an economic contingency plan after growth there slowed by almost a third in the second quarter to 2.4 percent.
Poland's Purchasing Managers' Index (PMI) fell for the sixth straight month to a worse-than-expected 47.0 points, the worst result since the depths of the previous economic crisis in July 2009.
In the neighboring Czech Republic, PMI fell to 48.0 in September from 48.7 in August, according to the data released by Markit. It was the sixth month below the 50-point barrier separating expansion from contraction.
In both countries, the declines were driven by weak output and new orders, a factor exacerbated in Poland by the end of a 19 billion euro investment project tied to the Euro 2012 soccer tournament and in the CZech Republic by a two-year government campaign to slash spending and raise taxes.
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Hungary's PMI, calculated under different methodology, rose to 52.5 in September, versus a revised 49.6 in August.
Reuters
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