Jobless rate in eurozone keeps rising

EUROZONE unemployment has risen to its highest level since the euro single currency was introduced, data showed yesterday, a day after EU leaders promised to focus on creating millions of new jobs to try to kickstart Europe's floundering economy.

Seasonally adjusted unemployment among the 17 countries sharing the euro rose to 10.4 per cent in December, on a par with an upwardly revised November figure, the European Union's statistics office Eurostat said.

It was the highest rate since June 1998, before the introduction of the euro in 1999.

"We're looking at a further increase over the coming months, so that is worrying," said Martin van Vliet, an economist at ING.

"Look at Greece, where unemployment is some 20 per cent, and it is 23 per cent in Spain. At a certain point this could lead to political unrest."

After two years of a deep debt crisis and budget austerity, the number of Europeans out of work has risen to 16.5 million people, with another 20,000 people without a job in December from the month before. The rate steadily crept up through 2011 as growth stalled and recession loomed.

At a summit on Monday, Europe's leaders tried to shift the debate from fighting the debt crisis to reviving growth in a bloc that produces 16 per cent of global economic output.

They are looking to deploy ?82 billion (RM328 billion) of unspent funds from the EU's 2007-2013 budget in an attempt to boost employment. But most economists expect scant progress while the eurozone's high debtors are compelled to persist with harsh austerity programmes.

A growing gap between the wealthy nations of northern Europe and those of the poorer, less productive south overshadows any EU-wide growth and jobs policies implemented from Brussels.

Germany's unemployment rate fell to 6.7 per cent in January, separate figures showed, a new record low since figures for unified Germany were first published.

Austria boasted the eurozone's lowest jobless rate at 4.1 per cent in December, followed by the Netherlands at 4.9 per cent. But Spain reached a new high of 22.9 per cent in November and December.

In Greece, joblessness was 19.2 per cent for October, the latest data available. Unemployment reached 13.6 per cent in Portugal in the final month of 2011.

High joblessness is a blight on the European economy, and youth unemployment is particularly problematic, particularly in Spain, where almost half of young people cannot find full-time work.

In the 27-nation European Union, the number of jobless has risen steadily from a recent low of 7.1 per cent of the working population in 2008 to 9.9 per cent in December - some 23.6 million people. Economists say it could reach 11 percent by mid-2012. Reuters