EMU: Unemployment Rate

Tue Oct 31 05:00:00 CDT 2017

Consensus Actual Previous Revised
Level 9.0% 8.9% 9.1% 9.0%

Eurozone joblessness fell a further 96,000 in September after a steeper revised drop of 95,000 in August. As a result, the unemployment rate declined from 9.0 percent to a surprisingly low 8.9 percent, its least significant mark since January 2009.

September's fall was led by the smaller member states as the rates in Germany, France and Italy were unchanged at 3.6 percent, 9.7 percent and 11.1 percent respectively while Spain was just a tick lower at 16.7 percent. Belgium (7.1 percent after 7.3 percent), Cyprus (10.3 percent after 10.6 percent) and Latvia (7.9 percent after 8.2 percent) were amongst the best performers.

There was also better news on youth unemployment which posted a 4,000 monthly decrease following no change in August. This reduced its jobless rate by a tick to 18.7 percent and compares very favourably with the 20.4 percent print a year ago.

The September labour market data suggest that the demand for new workers remains robust, in line with what is becoming an increasingly solid economy recovery. This should bode well for consumer spending over coming months.

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.