Unemployment edges higher across single currency area

City A.M. Reporter
JOBLESSNESS in the Eurozone rose to a new record high in May, pushed up by lay-offs in France, Spain and even stable Austria, as the two-and-a-half year debt crisis continued to eat away at the currency bloc’s fragile economy.

Around 17.56m people were out of work in the 17-nation euro area in May, or 11.1 per cent of the working population, a new high since Eurozone records began in 1995, the EU’s statistics office Eurostat said yesterday.

“Unemployment will continue to rise until we see an improvement in the economy, and that may not be until next year,” said Steen Jakobsen of Saxobank. “The next few months are likely to constitute a low in the growth cycle,” he said, predicting a contraction in output in the next quarter.

Economists at ING see unemployment reaching as high as 12 per cent if European manufacturing does not stage a recovery, they said yesterday.