Eurozone unemployment hits record high of 12%

Another day, another eurozone crisis. The jobless count across the eurozone is at its highest level since the single currency was launched in 1999, according to the EU's statistics office Eurostat.

by Rebecca Burn-Callander
Last Updated: 09 Oct 2013

The bloc is yet to recover from the aftershocks of the Cyprus bailout ordeal but today brings another barrage of bad news. Unemployment across the 17-nation zone hit 12% in February. January's 11.9% figure has also been revised up a notch to show two consecutive months of 12% unemployment. That's 19.07 million people out of work.

The speed at which unemployment levels are rising in certain nations is alarming: jobs have been disappearing faster than Russian oligarchs from Nicosian night spots. Across the whole of February, 33,000 people in the eurozone joined the ranks of the unemployed with Spain and Greece both suffering from unemployment rates above 26% - a quarter of the population out of work.

Of course, not all countries are suffering alike. The lowest jobless rates were recorded in Austria (4.8%) and in Germany, Europe's biggest economy, which has an unemployment rate of just 5.4%.

But there are still more ill headwinds lashing the eurozone today. The latest news from the eurozone's manufacturing sector shows that activity fell to a three-month low in March. According to the Markit eurozone manufacturing purchasing managers' index (PMI), output has contracted to 46.8, slightly higher than an initial estimate but below the 47.9 recorded in February. Any score below 50 means that the sector is shrinking. Even the mighty Germany has fallen below 50. France alone has seen an uptick in its manufacturing sector.

With PMI data showing no improvement in the eurozone's industrial output in March, it seems unlikely that there will be a recovery in the job market any time soon - not unless the service sector has a surprise resurgence. And, with Cyprus's economy forecast to shrink 10% over 2013, economists posit that the nation's jobless count could even exceed the highs in Greece and Spain.

MT's prediction: expect more eurozone unemployment pain for March.

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