European Union unemployment decreased to 8.3% in October

European Union unemployment decreased to 8.3% in October, which is the lowest level since February 2009. The total number of unemployed people in the EU-28 group amounts to 20.4 million people, as most of them are in the Eurozone currency bloc, where jobless people are 15.9 million. The overall unemployment decreased in 24 countries by the community. In Italy, the unemployment rate remained unchanged, while in Estonia, Denmark and Austria have growth. Between September 2015 and September 2016, for when the latest figures from Eurostat unemployed Estonians increased from 5.7% to 7.2%. In Denmark and Austria, the growth is more limited – of 6% to 6.5% and from 5.8% to 5.9%.

The lowest unemployment rates are in the Czech Republic (3.8%), Germany (4.1%) and Malta (4.9%). At the opposite end remains Greece (23.4%) and Spain (19.2%).

The most significant reduction of unemployment Eurostat observed in Croatia (from 16.1% to 12.7%), Spain (from 21.2% to 19.2%) and Slovakia (11.1% to 9.1% ).

Also the youth unemployment reduces. However, the problem remains serious in October, 18.4% of young people aged under 25 are unemployed. The most significant is youth unemployment in Greece (45.5%), Spain (43.6%) and Italy (36.4%).

The unemployment rate in the Eurozone decreased to 9.8% in October from a revised 9.9% in September. This is the lowest level since July 2009 and below market expectations of 10%. The unemployment fell from its record peak of 12.1% in April 2013, but remains above the record low of 7.2% from March 2008.

The labour market is a lagging indicator in the Eurozone, and it likely will continue to fall in the coming three-to-six months. This decline will mainly be driven by countries outside Germany, but we also remind that the structural level of unemployment in France, Italy and Spain is higher than in Germany, the US and the UK which are often used as benchmarks. This is particularly relevant in France, where we think the structural level of unemployment could be as high as 7%-to-8%. In Italy and Spain, though, the room for further declines remain significant.

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