Seasonally adjusted employment:

2Q 2012: flat q/q, -0.6% y/y
1Q 2012: -0.3% q/q (-0.2%)
4Q 2011: -0.2% q/q (-0.3%)
3Q 2011: -0.1% q/q (-0.2%)

PARIS (MNI) – Eurozone employment unexpectedly stabilized in 2Q
after accelerating job losses over the previous three quarters, Eurostat
said Friday.

In fact, employment actually increased marginally in seasonally
adjusted terms by 43,000 in 2Q after losses of 404,000 in 1Q and 363,000
in 4Q, leaving employment nearly four million below the pre-crisis peak
at 146.369 million. Unemployment rose by 473,000 in 2Q and by another
88,000 in July, Eurostat reported earlier this month.

Job gains in agriculture and the services in 2Q offset further
declines in industry and construction.

The biggest job losses were again in peripheral countries where
austerity measures have been most severe. Gains were limited largely to
a few core countries and, surprisingly, Italy.

In Spain, where the labor market meltdown has been most dramatic,
employment fell another 0.4% in 2Q and was 4.0% lower on the year. The
jobless rate is now at a record high above 25%; the rate for those under
25 is nearly 53%.

By contrast, employment in Italy rebounded 0.6% in 2Q, retracing
the drop in 1Q to stand 0.4% lower on the year. The Italian jobless rate
is over 10% and youth unemployment above 35%. The PMI polls show job
losses accelerated into 3Q (45.3 in August) and hiring expectations
deteriorated in August in all sectors except retail to stand well below
long-term averages, according to the European Commission’s surveys.

French employment was flat again in 2Q, as in two of three previous
quarters, and it was unchanged on the year as well. National data showed
private sector payrolls contracting by 22,400 in 2Q, with temporary
workers accounting for nearly 85% of the job losses, while semi-public
employment increased by 11,000. In late June, Insee forecast a loss of
37,000 private sector jobs in the second half of this year, a projection
likely to be overshot by far.

Germany again contributed the most to the active working force with
a 2Q gain of 0.2% for a 1.3% rise on the year. Another 16,000 jobs were
created in July. But with growth slowing, even employers here have
become more cautious. The German Labor Agency expects a “sideways
movement” over the rest of the year.

Among the smaller countries, 2Q job gains were registered in
Austria (+0.3%), Finland (+0.2%) and Estonia (+0.9%). There was little
change in the Netherlands and Slovakia. Declines were reported in
Belgium (-0.1%), Portugal (-0.2%), Malta (-0.3%), Slovenia (-0.4%) and
Cyprus (-0.5%).

Annual comparisons for 2Q showed the steepest losses in Greece
(-9.0%) and Portugal (-4.2%) and the largest gains in Austria (+1.4%),
Malta (+1.6%) and Estonia (+3.1%). Ireland reported a 1.1% annual
decline in 1Q.

Employment is likely to resume its downward path in the months
ahead as economic activity slumps, thereby dampening consumption further
and accentuating the cyclical downturn. The August PMI polls signaled
somewhat fewer job losses in industry (46.2) but little change in the
pace of downsizing in the services (48.4).

Hiring intentions as measured by the European Commission eroded in
August in all key sectors except for retailing and the financial

The OECD expects Eurozone employment to decline by 0.6% this year
and another 0.1% next year, giving an average jobless rate of 11.1% in
2013. The European Commission is only slightly less pessimistic,
forecasting a 0.5% contraction this year and stability next year, with
the jobless rate at 11.0%.

–Paris newsroom +331 4271 5540; email: