Fastest Eurozone jobs gain since 2008 could be halted by weaker economies

Tim Wallace
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EMPLOYMENT growth accelerated in the Eurozone in the second quarter, Eurostat announced yesterday, but the European Commission (EC) cut its growth forecasts for the rest of 2011.

Official figures point to a 0.3 per cent increase in Eurozone employment in the three months from April to June, while the 27 EU nations as a whole enjoyed a 0.2 per cent increase in jobs over the period.

That is an acceleration from the 0.1 per cent growth seen in the first quarter in both groups.

Compared with the same period in 2010, employment was 0.4 per cent higher in the Eurozone and 0.3 per cent higher in the EU27.

That growth is not expected to last, however. Based on analysis of the largest seven member states, the EC has revised its GDP growth estimates for quarters three and four down to 0.2 per cent in each. That is a fall of 0.2 and 0.3 percentage points respectively.

Analysts worry the gloomier outlook will impact on jobs.

“Unfortunately, the Eurozone economy has taken a marked turn for the worse in recent months and business confidence has weakened appreciably, and this will undoubtedly impact on labour markets,” said Howard Archer from IHS Global Insight.

Eurozone consumer price index inflation in the year to August remained at 2.5 per cent, unchanged from July’s figure.