Unemployment in eurozone at all-time high

Eurozone unemployment jumped to an all-time high in February, hitting southern nations the hardest as the social toll from the debt crisis grips the 17-nation bloc, official figures showed on Monday. The jobless rate rose for the 10th consecutive month and at 10.8 per cent set a 15-year record for the single currency area, according to the Eurostat data agency. Eurozone leaders have vowed to pursue growth and jobs strategies to fend off a looming recession but they insist that unpopular budget cuts and structural reforms must continue in order to restore market confidence after two years of crisis. In another sign that recession is gripping the region, a key survey showed that manufacturing activity dropped to a three-month low in March, with the “malaise” spreading to top economies Germany and France. “It looks odds-on that Eurozone GDP contracted again in the first quarter of 2012 after a drop of 0.3 per cent quarter-on-quarter in the fourth quarter of 2011, thereby moving into recession,” said Howard Archer, chief European economist at IHS Global Insight. “The prospects for the second quarter of 2012 currently hardly look rosy,” he said, adding that unemployment also appears “odds-on” to top 11 per cent in 2012. Eurostat estimated that more than 17.1 million men and women were out of work in February, 162,000 more than a month earlier and 1.48 million more than a year ago. The seasonally-adjusted unemployment rate also rose to a record in the wider, 27-nation European Union, hitting 10.2 percent in February compared to 10.1 per cent the previous month. An estimated 24.55 million people were unemployed in the EU, an increase of 1.87 million from February 2011. “Soaring unemployment is clearly adding to the pressure on household incomes from aggressive fiscal tightening in the region’s periphery,” said Jennifer McKeown, senior European economist at Capital Economics research firm. “But even in Germany, survey measures of hiring point to a downturn to come and with inflation remaining stubbornly high throughout the eurozone, there is very little hope of a consumer recovery,” McKeown said. The unemployment rate rose in 18 EU states and fell in eight compared to a year ago. It remained stable in Romania. Spain remained the worst affected, with the highest rate at 23.6 per cent, followed by bailed-out Greece at 21 per cent, Portugal at 15 percent and Ireland at 14.7 per cent. Italy hit a record 9.3 per cent.