EMU: Unemployment Rate

Mon Oct 02 04:00:00 CDT 2017

Consensus Actual Previous
Level 9.0% 9.1% 9.1%

Following a smaller revised 62,000 increase in July, unemployment resumed its downward trend with 42,000 drop in August. However, this was not large enough to reduce the unemployment rate which held steady at 9.1 percent, its third month at this level.

Germany (3.6 percent after 3.7 percent) and Italy (11.2 percent after 11.3 percent) went some way to shaving the headline rate but were thwarted by a rise in France (9.8 percent after 9.7 percent). Spain (17.1 percent) was unchanged.

Disappointingly, youth joblessness, which edged up 2,000 in July, climbed a further 4,000 although this was too small to raise the rate which was stable at 18.9 percent.

After a poor July, August's unemployment figures are better but not as good as they might have been. However, business surveys have pointed to a very solid pace of employment growth in recent months and historically high levels of consumer confidence do not indicate any real worries about job security. Upcoming data should be more optimistic.

The unemployment rate measures the number of unemployed as a percentage of the labor force.

Unemployment data are closely monitored by the financial markets. These data give a comprehensive report on the state of the economy and its future direction. A rising unemployment rate can be a warning sign of hard times while a low rate can be a warning of inflation as wages are bid up to attract labor.

Unemployment data are expressed in both a numerical value and as a percentage of the labor force. Generally, the definition of those unemployed follows that of the International Labour Organisation (ILO). It states that an unemployed person is one between the ages of 15 to 74 years of age who was not employed during the reference week, had actively sought work during the past four weeks and was ready to begin working immediately or within two weeks. The unemployment rate is the percentage of unemployed persons over the total number of active persons in the labor market. Active persons are those who are either employed or unemployed.

Eurostat provides an unemployment rate for each EU country as well as for the EMU and EU as a whole. It should be noted that the unemployment rate for a country will frequently differ with that reported by the national statistics agency. That is because of the varying interpretations of the ILO definition by member states and Eurostat.