Wednesday, October 27, 2010
Based on internet searches that lead to my website, there's quite a bit of interest regarding unemployment across Europe. Usually, they are led to this post, which is quite dated.
Going forward, I plan to update the European employment trends as they are released on the Eurostat website. Generally this data is about one month lagged from the national statistics offices, since Eurostat harmonises the employment data for seasonalities and adheres to the International Labour Organisation (ILO) recommended definition . The current release is for August 2010; September will be released in two days.
The first notable shift is that the 3-month moving average ending in August of the unemployment rate (the average across three months) fell compared to that ending in May (a sort of proxy of quarters) across 52% of the sample illustrated in the chart below (many EU economies plus Japan and the US). The average percentage drop (not drop in percentage points) was fairly small, though, -3.5% over the two periods (i.e., the green dot hovers around the outside end of the blue bar). For the September release, we will see the quarterly shift in Q3.
In the Eurozone, the Eurozone 16 that is, the shift in the unemployment rate over the last year is down for just 5 economies: Finland, Italy, Germany, Malta, and Austria.
(Note: some of you may wonder why I compare October 2009 to August 2010. Well, that's the way that it is listed in table teilm020 at the Eurostat website. One can get a longer time series, but this is the table I will use going forward.)
So there you have it. The harmonised unemployment rates are generally screaming "weak" in Europe. Going forward, fiscal austerity is expected to directly pressure unemployment rates across those countries that are tightening. Also, a persistent strengthening of the currency (has yet to be determined) may play a role in key exporting industries, like Germany, where exporters hire large pools of labor.
Update: Click here for the September 2010 report.