November preliminary: 10.3%
MNI survey median: 10.4%
MNI survey range: 10.3% to 10.4%
Previous: 10.3 Oct, 10.2% Sep, 10.1% Aug, 10.1% Jul, 10.0% Jun
PARIS (MNI) – The Eurozone unemployment rate held steady in
November at October’s record high of 10.3%, according to seasonally
adjusted data released Friday by Eurostat.
Most analysts had expected the jobless rate to rise further.
Although the jobless rate was unchanged, the number of unemployed
people rose by 45,000 to 16.372 million, a new Eurozone-era record,
Eurostat said. From its previous peak in April 2010, unemployment had
declined by only 427,000 before it began rising again a year later.
The jobless tide is likely to swell faster in the months ahead as
activity contracts, thereby dampening consumption and accentuating the
cyclical downturn. The December PMI polls show employment stagnant in
industry (49.9) and barely expanding in the services (50.6).
Employment expectations as measured by the European Commission
eroded further in December in the manufacturing sector, and they fell
sharply in the financial services. Hiring expectations also dropped in
the services sector, and they fell in retail trade, too, after a rebound
in November. In construction, employers had slightly higher hiring
expectations after a drop in November.
Given the cyclical lags in the services and retailing, it is
probably only a matter of time before firms begin to lighten payrolls.
The OECD expects Eurozone employment to contract by 0.3% this year,
more than retracing last year’s upturn, before recovering by 0.2% in
2013. The jobless rate would jump from an average of 9.9% in 2011 to
10.3% this year and stabilize next year.
Germany is likely to remain one of the few sources of Eurozone job
gains in the months ahead. Here the jobless rate fell another 0.1 point
in November to 5.5%, down 1.2 points on the year. National data for
December showed a further drop of 22,000 — enough to trim the rate by
0.1 point.
Yet even Germany’s labor market will lose some steam next year as
economic growth slows, a study by the national Labor Agency suggests.
After a drop of 270,000 this year, unemployment would fall by an average
of 50,000 next year, assuming GDP growth of 1.0%. Most of that decline
would come from the statistical carryover of this year’s reduction.
In France, the unemployment rose 0.1 point on the month to 9.8%,
according to Eurostat’s data. National data showed that the number of
registered jobseekers seeking full-time work rose by nearly 30,000 in
November, giving a rise of more than 80,000 since August.
French industry began shedding short-term employees in the third
quarter as production contracted further. Retailers and wholesalers as
well as service providers canvassed last month expected few new hires in
the near term, while builders anticipated further layoffs. The December
PMI polls, by contrast, signaled a recovery in hiring in both industry
(50.5) and the serices (53.2).
In Spain, where the meltdown in employment had been the most
dramatic, the jobless rate rose 0.2 point to 22.9%, by far the highest
in the Eurozone. The rate for those under 25 jumped 0.6 point to 49.6%.
While near-term employment expectations of Spanish service and
retail firms recovered in December, anemic domestic demand, the chronic
slump in the housing market and the slowdown in demand across the
Eurozone do not augur any lasting improvement in the labor market. The
OECD expects the jobless rate to average nearly 23% this year and
decline only slightly in 2013.
Italy’s jobless rate rose 0.1 point to 8.6% after a 0.2-point
rebound in October. Hiring expectations recovered in all main sectors
save construction in December, according to the Commission’s surveys,
but remained below average everywhere except for retailing.
Unemployment increased in most other reporting Eurozone countries
as well, boosting rates by 0.1 to 0.3 point. Rates ranged from a low of
4.0% in Austria to highs of 13.2% in Portugal, 13.5% in Slovakia and
14.6% in Ireland. Jobless rates were stable on the month in Slovenia and
Malta, and dipped 0.1 point in Finland and Belgium.
–Paris newsroom +331 4271 5540; e-mail: paris@marketnews.com
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