EMU: Unemployment Rate

Thu Nov 30 04:00:00 CST 2017

Consensus Actual Previous
Level 8.9% 8.8% 8.9%

The number of people out of work rose 12,000 to 14.344 million in October following a sharper revised 30,000 decline in September. This saw the jobless rate dip 0.1 percentage points to 8.8 percent, a tick below market expectations and its lowest reading since January 2009.

Amongst the larger four members states, only France (9.4 percent after 9.5 percent) recorded a decline. Germany (3.6 percent), Italy (11.1 percent) and Spain (16.7 percent) were all unchanged. Malta (3.5 percent) took Germany's place at the bottom of the unemployment ladder while Greece (20.6 percent in August) remained easily at the top.

There was better news on youth joblessness which fell a further 9,000 to 2.657 million. The rate slipped a notch to 18.6 percent, some 1.7 percentage points short of its level a year ago.

The increase in overall Eurozone unemployment last month is surprising given the apparent buoyancy of the regional economy. However, given September's sizeable revision, this should prove only temporary. Certainly, if wages are to pick up as needed to boost CPI inflation, a further tightening of labour market conditions will be vital.

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.