Jobless youth may create ‘lost generation’
Europe
The wider 27-nation EU that includes non-euro countries such as Britain and Poland had an unemployment rate of 10.7 percent in October and a total of 25.9 million out of work.
“The level of unemployment in Europe remains unacceptably high,” said Jonathan Todd, a spokesman for the European Commission, the EU’s executive arm.
Also Friday, lawmakers in Germany’s lower house of Parliament passed the next round of financial support for Greece, despite doubt among members of Chancellor Angela Merkel’s coalition and opposition parties that the measures will be sufficient to resolve the Greek problem. In total, 473 of 584 lawmakers casting ballots voted in favor of the package of measures agreed to by European finance ministers and international lenders last week that will unlock loan installments totaling $56.7 billion. Germany is one of Greece’s largest creditors and support from Berlin is crucial for the success of the program.
Spain and Greece have the eurozone’s highest unemployment rates — both over 25 percent, with youth unemployment levels heading toward 60 percent, a figure that could have a long-term economic and political impact.
“Talk of a ‘lost generation’ of young people now looks like an alarming possibility,” said Andrea Broughton, principal research fellow at the Institute for Employment Studies.
Both countries are in recession and struggling to convince investors, as well as their own people, that they can control their economies. Both, along with a number of other European countries, have introduced tough austerity mea- sures, such as cutting spending and raising taxes, in order to get a handle on their debts. But measures such as reducing wages and pensions hit the labor force in the pocket and lower demand in the economy.
Other measures taken alongside the austerity, such as reforming labor practices, boosting skills and education, are intended to promote jobs but they take time, both to enact and to feed through an economy.
“We expect, however, that progress in structural reforms, especially those that improve the functioning of labor markets, will help lower unemployment and facilitate new employment opportunities,” Mario Draghi, the president of the European Central Bank, said Friday in Paris.
Some economists predict that unemployment in many countries will keep rising for months to come, certainly as long as the economies remain in recession. Draghi said Friday that he expects the recovery in the eurozone to start only in the second half of next year.