Eurozone unemployment lowest in eight years

The relatively low unemployment rate in the euro area masks stark differences across the 19-country bloc and even within countries. A visual recap of the jobs situation in Europe.

More than a million people have been lifted out of unemployment in the eurozone during the past year. In February, unemployment fell to 9.5%, the lowest rate since May 2009. At the height of the financial crisis, unemployment in the region peaked at 12.1%.

Unemployment is generally seen as a lagging indicator for the health of an economy. So the overall outlook on the euro area economy looks brighter. But the signs of hope are dampened by the very large disparities between countries as illustrated in the animated map below.

The prolonged recession that lasted from 2008 to 2013 has caused a sharp rise in unemployment. Switzerland’s labour market barely budged during that period. But southern European countries like Spain, Greece, Portugal and Italy have borne the brunt of the financial and housing crises. The government debt crisis and austerity measures in these countries have made things worse. 

Other factors that can explain the shortage of jobs in southern Europe include lack of job training programmes, rigid labour laws and inflexibility that comes from being tied to the single currency. 

The falling unemployment in the euro area is in line with analysts’ expectations for 2017. As of February 2017, Germany’s unemployment rate was at its lowest since the country’s reunification in 1990, at 3.9%. Meanwhile, Switzerland’s unemployment rate remained stable at around 4.6% in 2016.