Now a fifth of youths in Eurozone are jobless
Youth unemployment in parts of the eurozone is on the rise again, official figures show.
the number of under-25s without work has risen from 47.3 per cent to 50.3 per cent in Greece and from 37.3 per cent to 39.2 per cent in Italy.
Youth unemployment in the single currency bloc is now 21.1 per cent, according to the statistics agency Eurostat.
three million who want a job cannot find work. Although youth unemployment fell in Spain, 43.9 per cent are out of work. unemployment for all ages in the region is 16.3million – or 10.1 per cent of the workforce. that is more than double the 4.9 per cent jobless rate seen in the UK.
Separate figures from Eurostat showed the threat of deflation continues to plague the eurozone with prices rising by just 0.2 per cent in 12 months.
A prolonged period of deflation or falling prices – as seen in Japan over the past two decades – can cripple economies by killing off demand, hitting profits and wages, and driving up unemployment.
the bleak figures pile pressure on the European Central Bank to take further
‘Weary path of despondency’
action. the bank has been printing £68billion of money each month to pump cash into the economy and interest rates have been cut below zero with free loans offered to banks.
Laith Khalaf, senior analyst at hargreaves Lansdown, said: ‘Despite billions of euros being thrown at it, the eurozone economy is still not for turning.
‘the only good news is that things aren’t getting significantly worse, but it’s a real slow grind towards recovery for the eurozone, and it’s by no means assured even though the worst of the crisis appears to be over. things are particularly bleak for young people in Spain and Italy where youth unemployment rates are staggeringly high.’
Nobel Prize winning economist Joseph Stiglitz, a former adviser to President Bill Clinton, has blamed the malaise in Europe on ‘the fatal decision to adopt a single currency’.
he said: ‘In a well-functioning economy, there’s rapid growth, the benefits of which are shared widely. In Europe we see the opposite.’
the International Monetary Fund still believes Britain will grow faster than Europe’s biggest economies in the coming years despite voting to leave the Eu. having previously warned that Brexit could trigger a fresh UK recession, the watchdog now expects the British economy to grow by 1.7 per cent this year and 1.3 per cent next year.
that is weaker than the 1.9 per cent and 2.2 per cent growth forecast before the referendum and marks a significant downgrade to the outlook.
But the UK is still set to be the second fastest growing economy in the Group of Seven industrialised nations this year behind the united States and third next year behind the US and Canada. In both 2016 and 2017, the UK economy is expected to outpace the rest of the G7 – Germany, France, Italy and Japan.
the forecasts represent a climbdown for the IMF after it issued a string of warnings over the damage leaving the Eu would do to the British economy.
David Buik, an analyst at stock broker Panmure Gordon, said: ‘Double digit unemployment is here to stay and will be exacerbated by draconian austerity measures. the youth can only tread a weary path of despondency.
‘the openings in business industry and commerce are just not there.’
John Longworth, the former head of the British Chambers of Commerce who backed Brexit, said: ‘Europe continues to be the sick man of the world in terms of its torpid economic performance.’