Eurozone SA Unemployment Persists at 8.3% as Number of Jobless Increases
6 April 2021By David Barwick – FRANKFURT (Econostream) – Seasonally adjusted unemployment in the euro area measured by International Labour Organisation (ILO) standards was stable at 8.3% in February, but up from 7.3% in February 2020, EU stats office Eurostat reported on Tuesday.
The stable monthly result masked an increase of 48,000 unemployed persons in the region from January to February. There were 1.507 million more unemployed people in the euro area in February 2021 than in February 2020.
The high-level results also belied considerably more disparate unemployment situations at the national level. While German and Dutch joblessness in February came in at 4.5% and 3.6%, respectively, Spain registered 16.1%, France 8.0% and Italy 10.2%.
The European Central Bank has repeatedly invoked the weak state of labour markets in arguing that the current surge in inflation will prove short-lived.
In his blog post last week, ECB Chief Economist Philip Lane observed that ‘[t]he current state of the labour market is heavily shaped by the array of pandemic-related fiscal supports to firms and workers, such that the underlying prospects for employment and earnings remain highly uncertain.’
‘The elevated uncertainty about job prospects also points to vulnerabilities ahead’, he wrote. ‘[T]te generation of sustained wage pressures requires a labour market that is sufficiently hot, which will require a reabsorption of a considerable amount of labour market slack.’
‘Moreover, the elevated uncertainty about future employment and wage dynamics is likely to constrain consumer spending’, he added.
German unemployment in March registered an unexpected decline, but with lockdown measures being tightened, prolonged or reinstated in various places, a labour market revival remains a very open question in the short term.