Unemployment fell slightly in Europe in February for the third consecutive month. But there are still deep differences among countries and little agreement on how the EU will climb out of the recession in the near future.
The jobless rate in the 19 countries that make up the eurozone fell to 11.3 percent to 11. 4 percent. This is the lowest rate in the eurozone since May 2012. In the US, the unemployment rate was 5.5 percent in the same period.
The number of unemployed men and women decreased by 49,000 people in the euro area, compared to January 2015, and 643,000 people compared to a year ago, according to Eurostat, the statistical office of the European Union.
But if the overall rate shows a slight improvement, the individual rates for the eurozone member states show that each country has a different puzzle to solve on its way out of recession.
Germany, for instance, has the lowest unemployment rate in the region, with 4.8 percent, which can be considered almost full employment. The weak euro and low oil prices are pushing an increase of 2.4 percent in private consumption and 2.2 percent in GDP, according to Andreas Scheuerle from Dekabank. But such good shape also means it can’t really get any better and help pull the overall European unemployment down.
“Everybody I know either has a job, is studying or freelances,” said Sascha Bachmann, 31, a photographer based in Berlin. Even a friend of his, a single mother of two, spent only a few weeks unemployed. “And that was because it was hard for her to find something with flexible hours. All jobs right now are full time,” he described.
Low unemployment rates don’t necessarily mean that the economy is in good shape. “Austria and Finland’s rates are lower than the European average, but Austria is very exposed to Middle Eastern countries, and Finland to Russia,” said Scheuerle. “The crises in these countries are affecting Austrian and Finnish economies.”
On the same token, countries with significantly higher unemployment rates like Spain have optimistic outlooks, with economic growth, structural reforms and the labor market picking up. “Spain is one of the peripheral shooting stars,” described Scheuerle in a phone interview from Frankfurt. “Spain made its reform homework and is now gets the good things from those reforms.”
Anna Torras, 33, export manager for a small firm in the outskirts of Barcelona, agrees. After working in New York for nearly a year, she spent five months looking for a position. She sent out more than 50 applications, went to 15 interviews and got six offers until settling for Infosa, where she started to work three weeks ago. “Most of the offers offered very low salaries,” she said. “I was not ready to earn less than before I moved to the United States.”
There is however a third situation, where some countries might have naturally high unemployment rates and there might not be much slack left to boost their economies further. Such is the case of Italy and Portugal, according to Jonathan Loynes, chief European economist for Capital Economics in London.
Italy might be the third biggest economy in Europe, but along with Portugal, it has never really grown inside the EU. “Both have deep competitiveness and structural problems, like labor constraints and regulations,” said Loynes. “They are supposedly making progress, but it will be very slow. It’s probably unlikely to see any difference in the next few years.”
Chiara Marceddu, 31, is from Sardinia in Italy, but moved to Berlin to find work. She has a bachelor degree in Politics but now works part-time as a social worker for the German government. It took her six months to find this position, but she knows her friends back home have it worse: “I’ve got friends with a PhD and no jobs, not even as a dishwasher. It seems absurd, but it’s unfortunately true.”