–Clarifies First Graph To Show Stabilization Of Rate

August: 10.1%

MNI survey median: 10.0%

Previous: 10.1% Jul, 10.1% Jun, 10.1% May, 10.0% Apr, 10.0% Mar

FRANKFURT (MNI) – The jobless rate across the Eurozone stabilized
at a record 10.1% in August, matching upwardly revised figures for May,
June and July, Eurostat reported on Friday.

Most analysts had expected no change from the initially estimated
level of 10.0% in July.

While the jobless rate remains at an all-time high, the number of
unemployed fell 20,000 on the month since July to 15.869 million.
August’s unemployment level was still 569,000 higher than a year
earlier.

The unemployment rate for people under 25, which would likely
respond first to new trends in the labour market, fell to 19.8% in
August from an upwardly revised 20.0% in July. Nevertheless, the figure
remains well above the overall rate.

Recent surveys do not hint at any significant improvement for the
Eurozone labour market in the near term.

Manufacturers and service providers cited in Markit Economics’
purchasing managers index (PMI) for September reported sluggish
employment gains this month (51.3).

The latest European Commission survey showed employment
expectations in the major sectors outside manufacturing and retail
remaining well below the norm.

By contrast, consumers’ fears of being unemployed over the next
year continued to decline in September, reaching their lowest point
since July 2008. However, the Commission’s aggregate figure masked
significant divergences among the various Eurozone states. In core
countries like Germany and France, jobless fears fell below averages,
while they rebounded in Spain, Italy and Greece, countries where labour
unrest was brewing due to planned government austerity measures.

Developments in unemployment varied widely from country to country
within the Eurozone.

Germany’s jobless rate slipped to 6.8% in August, according to
Eurostat calculations. Earlier this week, the Federal Labour Office
reported that the number of payroll jobs had climbed by 46,000 in the
same month, while the number unemployed had fallen by a further 40,000
in September.

Forward-looking indicators suggest that the downward trend in
German unemployment is likely to continue for some time. The Ifo
institute’s employment barometer released at the end of August
stabilized near multi-year highs. A separate Ifo survey showed that 87%
of German firms hope to take on additional staff over the next year
compared to only 4% who are looking to cut jobs.

In France, the unemployment rate rose for the second month in a row
to 10.1% in August. National figures showed that the number of
jobseekers rebounded in August after two consecutive periods of
declines, retracing over two thirds of the decline in June and July to
end at nearly 2.7 million. Including those who are part-time employed
but also looking for work, the number of those actively searching for
employment came closer four million in August.

French PMIs showed employment rising in September, Markit reported.
However, the gain was exclusively on the services side (54.4), while
manufacturers continued to cut jobs this month. Sector surveys by
France’s national statistics institute in September pointed to modest
hiring in all main sectors except for industry and construction in the
near term.

With an unemployment rate of 20.5%, Spain continues to have the
largest proportion of its labour force actively looking for work. The
unadjusted 1.6% rebound in the unemployed level since July, however, is
especially unfortunate, given the boon to the labour market expected
during tourist season. With tourist season over, seasonal effects could
result in a renewed increase in September.

The lowest unemployment rate was recorded in Austria (4.3%),
followed by the Netherlands (4.5%) and Luxembourg (5.0%). Next to Spain,
the highest rates were seen in Slovakia (14.6%), Ireland (13.9%) and
Portugal (10.7%).

— Frankfurt bureau; +49-69-720 142; email: frankfurt@marketnews.com —

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