Greece's Unemployment Rate Hits Record 20.7% in 4Q

Published March 15, 2012

| Reuters

Greece's jobless rate rose to a fresh quarterly record of 20.7 percent in the last three months of 2011, reflecting the country's deep economic malaise, exacerbated by austerity to repair public finances and emerge from a debt crisis.

Greece secured a new 130 billion euro bailout from its euro zone partners and the IMF this week, after agreeing further painful budget cuts. But the labor market's sharp deterioration is feeding public discontent and hurting consumer confidence.

On Thursday, statistics agency ELSTAT data showed jobs being shed at a fast pace as unemployment rose from 17.7 percent in the third quarter and 14.2 percent in the last quarter of 2010.

"The quarterly unemployment data reflect the deepening pace of the domestic economic contraction. Considering that unemployment is a lagging indicator, we should not rule out a further rise in the jobless rate in the months ahead," said EFG Eurobank economist Platon Monokroussos.

Young people have been hardest hit by the country's protracted economic recession. Almost four in ten people in the 15-to-29 age group were out of work, data showed, up from 28 percent in the same period a year earlier.

One of the worst affected economic sectors is construction, where employment dropped 19 percent year-on-year.

Greece's 215 billion euro economy slumped by 7 percent in 2011 and is projected to remain in recession for a fifth consecutive year in 2012.

The economic downturn is making it harder for the government to meet revenue targets and cut the budget gap, raising the risk that further belt-tightening may be necessary.

"It will be difficult to stabilize the trend in the first half of 2012. The main hopes for a slowdown in the trend rest on the summer months when there may be an improved picture because of tourism and exports," said National Bank economist Nikos Magginas.

ELSTAT said the number officially unemployed reached 1,025,877 in the fourth quarter, an increase of 44.1 percent year-on-year and of 16.8 percent from the third quarter.

Greece's December unemployment rate was almost double the 17-country euro zone's seasonally adjusted average of 10.6 percent, but is still lower than 22.9 percent seen in Spain in the fourth quarter.

Greek unemployment figures are not seasonally adjusted.

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