Eurozone jobless rate hits record 11.1%

The eurozone debt crisis delivered more bad news on Monday with data showing record high unemployment of 11.1 percent and a manufacturing outlook at its lowest levels for three years.

Unemployment hit its highest point since the eurozone was created in 1999 and analysts warned that job queues would likely continue to lengthen in coming months.

"It now looks odds-on that the eurozone unemployment rate will reach 11.5 percent by the end of the year, although the situation will vary markedly between countries," forecast Howard Archer, chief economist at IHS Global Insight.

More than 17.5 million people were jobless in the 17-nation eurozone in May, as 88,000 more men and women lined up for benefits. Spain was the hardest hit with almost one in four unemployed, according to Eurostat data agency.

Youth unemployment surged again, with 3.4 million people under 25 looking for work, an increase of 254,000 from 12 months earlier.

"It was of little real comfort that May's rise in unemployment was actually the smallest for 11 months," Archer noted.

A key survey meanwhile showed that manufacturing activity remained at its lowest level since the summer of 2009, with the second quarter registering the biggest contraction for three years.

"We fear that the 'growth pact' agreed by EU leaders last week will not be enough to foster a sustained recovery -- and that more is likely to be needed, starting with an ECB rate cut on Thursday," said Martin van Vliet of ING.

European Union leaders agreed at the summit on growth measures to offset budget reforms imposed on debt and deficit sinners that some say have choked struggling economies.

Van Vliet said the pace of reform should be slowed if politically feasible.

Capital Economics economist Mark Miller noted that "the labour market is a lagging indicator of overall economic conditions.

So it is of particular concern that recent business surveys have pointed to renewed recession across the euro-zone," he said.

Both the employment data and bleak manufacturing PMI figures raised the risk of eurozone unemployment reaching 12 percent, van Vliet commented.

The eurozone unemployment rate has stayed above 10 percent for 13 months as the bloc struggles to revive economies undermined by a debt crisis now in its third year and threatening major economies in Spain and Italy.

In the wider 27-nation European Union, unemployment rose to 10.3 percent against 10.2 in April, the same level as in March. About 24.86 million men and women were jobless in the EU as unemployment increased by 151,000 people.

Spain posted once again the worst unemployment rate at 24.6 percent, with more than one in two people under 25 without work.

Greece was next at 21.9 percent in March, the latest available figures for that country, followed by Latvia at 15.3 percent in the first quarter and Portugal at 15.2 percent in May.

Austria has the lowest rate at 4.1 percent, followed by the Netherlands at 5.1 percent, Luxembourg at 5.4 percent and Germany at 5.6 percent.

The Purchasing Managers Index (PMI), a survey of 3,000 manufacturers compiled by the London-based research firm Markit, remained unchanged in June from May at 45.1 points, from 45.9 in April.

Any level below 50 points indicates economic contraction.

The rate of decline for the second quarter from the first was the biggest since the same period in 2009.

"Companies are clearly preparing for worse to come, cutting back both on staff numbers and stocks of raw materials at the fastest rates for two-and-a-half years," said Markit economist Chris Williamson.

Ireland, however, proved an exception in gloom, registering a 14-month high figure of 53.1 in the pace of manufacturing expansion.

Powerhouse Germany saw its steepest decline in three years to 45.0 points however, its fourth successive monthly fall.

"With the eurozone likely having suffered appreciable GDP (gross domestic product) contraction in the second quarter and in grave danger of contracting again in the third, and with eurozone business confidence generally low and fragile, the likelihood is that the eurozone unemployment rate will move significantly higher over the coming months," Archer concluded.

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • ‘Taklub’ wins jury prize in Cannes
    ‘Taklub’ wins jury prize in Cannes

    The Yolanda-inspired film “Taklub” has won a special award at the Cannes Film Festival in France. The advocacy film, which had a successful premiere last Tuesday under the festival’s Un Certain Regard section, is directed by 2009 Cannes best director Brillante Mendoza and top-billed by Nora Aunor. The award cited the film’s sensitive portrayal of individuals and communities in the Philippines fighting to continue living despite natural disasters exposing them to suffering and death. …

  • Orphan tops chemical engineering board exam
    Orphan tops chemical engineering board exam

    A 21-year-old orphan from Capiz topped the chemical engineering board examinations held this month. Remington Salaya, a cum laude graduate of the Central Philippine University in Iloilo, ranked first in the board examinations with a score of 83.30 percent. Out of 405 chemical engineering graduates who took the exam in mid-May, 239 passed. …

  • A sunset party for APEC delegates
    A sunset party for APEC delegates

    Greeted by the beat of Ati-atihan drummers, delegates of the Asia-Pacific Economic Cooperation trade ministers meeting enjoyed a welcome dinner and cultural presentation at sunset yesterday. Dubbed FuntaSea, Shangri-La Boracay Resort and Spa’s Banyugan Beach was transformed into a fantasy island, complete with mermaids, fire dancers, and choreographed paraws (sailboat) representing the best of Boracay. With APEC meetings being held all over the Philippines, each presentation is conceptualized …

  • UN chief urges peaceful solution of sea dispute
    UN chief urges peaceful solution of sea dispute

    United Nations Secretary-General Ban Ki-moon called Friday for a peaceful solution to territorial disputes in the South China Sea, where China’s increased assertiveness has alarmed its smaller neighbors. In Manila, Presidential Communications Operations Office Secretary Herminio Coloma Jr. appealed to China to respect various international agreements on freedom of navigation and aviation. Coloma’s call came in the wake of an incident Wednesday where Chinese naval forces warned a US …

  • Phl seeks transparency, inclusivity in Asean-China Center
    Phl seeks transparency, inclusivity in Asean-China Center

    Philippine Ambassador to the Association of Southeast Asian Nations Elizabeth Buensuceso has called on participants of the ASEAN-China Center (ACC) brainstorming session to vigorously work on promoting ASEAN-China relations under the principles of inclusivity, transparency and centrality. The brainstorming session, attended by the ACC’s joint council and joint executive board members, also involved a midterm review of ACC’s work since its establishment in 2011. The ACC aims to promote …

  • Lebanon tightens rules on HSW repatriation
    Lebanon tightens rules on HSW repatriation

    Distressed Filipino domestic helpers in Lebanon may find it more difficult to return home. The government of Lebanon has tightened the rules on repatriation of distressed household service workers (HSWs), Labor Secretary Rosalinda Baldoz reported yesterday. Citing a report from the Philippine Overseas Labor Office (POLO), Baldoz said the Lebanese government opted to re-impose a previous policy requiring investigation into every case of HSWs who ran away from their employers and sought …

  • Army execs face attrition over promotion quota
    Army execs face attrition over promotion quota

    Dozens of Philippine Army officials may be removed from the service due to a promotion quota system in the Armed Forces of the Philippines, according to AFP chief Gen. Gregorio Pio Catapang. In a letter to Defense Secretary Voltaire Gazmin, he requested that the 30 percent promotion quota – which means that only 30 percent of those eligible for promotion in a given year will actually be promoted – in the Army be raised to 50 percent. Under the military’s attrition law, middle-grade officers …

  • Philippines backs support for small enterprises at APEC meet

    MANILA, Philippines (AP) — The Philippines' top trade official on Saturday called for support for the integration of micro, small and medium enterprises in global trade, which he said would help reduce poverty and inequality in the Asia-Pacific region. …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options