Unemployment across Europe is getting worse, not better. Eurostat, the EU’s statistics office, stated that unemployment in the areas of the Eurozone rose to 11.1% in May, up from 11% in April. This was the highest unemployment number recorded in Europe since 1999. Apparently the measures European leaders are taking haven’t put a dent in unemployment at all.
There had been temporary euphoria, when eurozone leaders agreed to allow Europe’s bailout fund to rescue banks directly without adding new austerity measures. A stock market rally ensued, but the unemployment numbers released by Eurostat have cast a shadow over European financial markets. Only the strength of Germany’s economy has kept expectations afloat, as six countries in the Eurozone are in recession.
Ashley James, senior European economist at RBC Capital Markets, noted that the future doesn’t look bright: “The numbers ... indicate ongoing labour market weakness, with further deterioration highly likely in the second half of the year,” he said.
In Spain, nearly 25% of people were out of work in May; 52.1% of the country’s youth were unemployed. Greece’s youth suffered the same way; at 52.1% of them were out of work.
And anyone who claims that the United States is the bulwark for Europe better reconsider; since the first quarter of 2009 exports have accounted for fully 41% of any recovery we’ve supposedly made, so if Europe has no money, we won’t either. 21% of the cumulative growth in US exports over the past three years has been from sales to Europe.
Europe’s problems are not going to be confined to Europe. Our real unemployment numbers are similar to the Eurozone’s as a whole. If we don’t take some austerity measures of our own, like cutting taxes and reducing the size of the federal government, it won’t be long before we’re just like they are.