RTTNews - Unemployment in the Eurozone rose to its highest level in nearly ten years in April as the global economic downturn pulled a number of Europeans out of work, official data showed Tuesday.
The seasonally adjusted jobless rate rose to 9.2% in April from 8.9% recorded in March, the Luxembourg-based statistical office Eurostat said Tuesday. This is the highest rate since September 1999 and a touch higher than the 9.1% expected. A year ago, the jobless rate was 7.3%. The number of unemployed persons increased by 396,000 to 14.58 million in April from 14.18 million in March.
The jobless rate for the EU27 stood at 8.6% in April, the highest since January 2006 and up from 8.4% in March. The rate was 6.8% in April 2008.
In the Eurozone, Spain recorded the highest unemployment rate, while the Netherlands had the lowest.
The jobless rate for Germany rose to 7.7% from 7.6% and that for France inched up to 8.9% from 8.8%. German's are widely accepting short-term work to combat the rising unemployment amid the worst recession since the Second World War. Most economists see chances for a sudden rise in unemployment once firms end short-term employment programs.
As the use of traditional monetary tools reached its limit, the European Central Bank announced non-conventional measures to battle the recession. The ECB in May announced that it is planning to buy nearly EUR 60 billion worth covered bonds, joining the Federal Reserve and other central banks in purchasing debt under their quantitative easing policies. Further details of the plan would be announced after the Governing Council meeting on June 4.
After cutting the key interest rate to a record low of 1% in May, ECB President Jean-Claude Trichet had said there are some tentative signs of a stabilization, albeit at very low levels.
However, the labor market situation in the euro area is expected to remain bleak this year and the next. The European Commission said in its spring forecast that the jobless rate will probably rise to 9.9% this year and will reach 11.5% in the coming year. Forecasts from the International Monetary Fund also paints a similar picture. The lender sees 2009 jobless rate for the region at 10.1% and the 2010 rate at 11.5%.
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