European unemployment hits 12-year high
European unemployment unexpectedly rose in April, reaching a 12-year high as the region’s sovereign debt crisis undermined the outlook for the economy.
The jobless rate in the 16-nation euro area increased to 10.1pc from 10pc in March, the highest rate since June 1998, the European Union’s statistics office in Luxembourg said today.
Economists had forecast that the rate would remain unchanged in April, according to the median forecast of 10pc in a Bloomberg News survey of 26 economists.
Europe’s economy may struggle to gather strength after contagion from Greece’s fiscal crisis eroded confidence among consumers and companies last month and forced governments to deepen spending cuts to reduce budget deficits.
The Stoxx Europe 600 share index has lost 10pc over the past two months.
“The consolidation measures can be expected to have some short-term negative impact on growth and employment,” Lucas Papademos said yesterday as his term as European Central Bank vice president ended.
The highest unemployment rate in the euro area was in Spain, at 19.7pc, the report showed.
After emerging from an almost two-year recession in the first quarter, the Spanish government announced the deepest budget cuts in at least 30 years last month to tackle the third-largest deficit in the euro region.
The jobless rate in Ireland was 13.2pc and the rate in France was 10.1pc.