April preliminary: 11.0%

MNI survey median: 11.0%
MNI survey range 10.9% to 11.0%

Previous: Mar 11.0% (10.9%), Feb 10.9% (10.8%), Jan 10.8%, Dec 10.7%

PARIS (MNI) – The rise in Eurozone unemployment slowed slightly in
April for the third month in a row, which left the jobless rate
unchanged at March’s upwardly revised record high of 11.0%, according to
seasonally adjusted data released Friday by Eurostat.

The number of unemployed rose by 110,000 after +133,000 in March
and +141,000 in February. The total of 17.4 million in April was nearly
1.8 million higher than a year earlier. Nearly a fifth were young people
under 25, for whom the jobless rate stood at 22.2%.

The jobless tide will continue to mount in the months ahead as
economic activity slumps, thereby dampening consumption further and
accentuating the cyclical downturn. The May PMI polls signaled little
let-up in downsizing, with industry jobs falling at the quickest clip in
27 months.

Hiring intentions as measured by the European Commission eroded in
all key sectors in May and were below long-term averages everywhere
except for industry.

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%.

Germany is likely to remain one of the few sources of Eurozone job
gains in coming months. Here the jobless rate was down 0.1 point in
April to 5.4%, though national data showed a 18,000 rise in the number
of unemployed. Seasonally adjusted unemployment stabilized in May in
national terms and the jobless rate ticked down another notch.

Yet even German employers appear to have become more cautious.
Ifo’s latest business survey revealed more “defensive” recruitment
plans. The May PMI polls showed a slight upturn in the composite
employment index (50.3) after dipping below 50 in April for the first
time since early 2010.

In France, the unemployment rate rose 0.1 point in April to 10.2%.
National data showed the smallest monthly rise in registered jobseekers
seeking full-time work (+4,300) in a year. But leading indicators are
not promising. The PMI polls show employment contracting marginally in
March and April and more steeply in May (47.7). Hiring prospects remain
unfavorable in all key sectors, according to the national statistics
institute Insee.

After a 0.3-point upward revision for March, Italy’s jobless rate
gained another 0.1 point in April to 10.2%, despite a 0.4-point downturn
in youth unemployment to 35.2%. The April composite PMI signaled an
acceleration in job losses (45.3) at the fastest pace in nearly three
years. Employment expectations deteriorated markedly in all sectors in
May to stand well below long-term averages, especially in the services
and construction, according to the Commission.

In Spain, where the meltdown in employment has been the most
dramatic, the jobless rate rose 0.2 point to 24.3%, approaching the
record high eight years ago. The rate for those under 25 jumped 0.4
point to 51.5%. Employment contracted by over 2% in 1Q, with an
especially steep fall in the services, national data show.

The ongoing contraction in Spain’s economic activity amid drastic
austerity measures points to a further rise in unemployment over the
course of the year, as the latest labor market reforms may only dampen
the climb. Economics Minister Luis de Guindos has projected a net loss
of 620,000 jobs this year. The May factory PMI flagged another marked
drop in payrolls. The OECD said last month that while job losses could
level off next year, the jobless rate was likely to reach 25.3% on
average.

In other reporting Eurozone countries, trends were mixed. At the
low end in the core countries, Austria (3.9%) and Malta (5.7%) both saw
their jobless rates decline 0.1 point. Luxembourg’s (5.2%) was stable
for the second month in a row, while the Netherlands (5.2%) sustained a
0.2-point rise. In Belgium (7.4%) the rate rose 0.1 point. Finland’s
rate (7.6%) has been unchanged since September.

At the high end, Portugal (15.2%) saw a 0.1-point rise, while
Ireland (14.4%) and Slovakia (13.7%) both shed 0.2 point. Rates in
Cyprus (10.1%) and Slovenia (8.7%) were both up 0.1 point. The latest
available results for Greece (21.7%) showed a 0.4-jump in February.

–Paris newsroom +331 4271 5540; e-mail: ssandelius@marketnews.com

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