Policy Research in Macroeconomics

Signs of very marginal improvements in Greece – but unemployment still over 25%

The headline news from the latest Labour Force Survey results is that Greece’s unemployment has fallen just a little in January 2015 – it is now 25.7% compared to 27.2% in January 2014, and to 25.9% in December 2014.  The annual fall in unemployed is around 87,000, but note that the total number of unemployed is still a massive 3.53 million.

The employment situation has improved even less compared to a year ago – with a gain of just 37,000 finding employment compared to a year ago.  Since the number of economically inactive has hardly changed, there has been a fall in population – due notably to migration we infer – of over 200,000, or 3.5%, since 2010.  And note that the number in employment in January 2015 is still 310,000 fewer than in January 2012 (-8% over the period).

Unemployment is today affecting women workers more strongly than men.  While still appalling for men 22.5%, the rate of female unemployment is almost 30% (in detail, 29.6%).  The position for youth unemployment is slightly better – “only” 50% of 15-24 year olds are now unemployed, compared to a year ago.  The position is if anything more shocking for the next age cohort, of 25-34 year olds, who still suffer 34.1% unemployment (was 35.7% in Jan. 2014).  For 35-44 year olds, nothing has changed in a year – the rate of unemployment is stuck at 23.3%.

In other economic news from the Hellenic Statistics Office, CPI “inflation” in March 2015 was actually (once more) deflation, at -2.1% year on year (a slightly lesser deflation rate than in January).  However, March was the 25th consecutive month showing a fall in the CPI level compared to the same month a year before.

One somewhat positive point is that Greece’s Index of Production in Industry rose by an annual 1.9% in February. Whilst mining and quarrying production decreased by 17.4%, manufacturing production increased by 5.8% (main drivers – coke & petroleum products; computers, electronics and optical equipment; tobacco products).  The February 2015 level of the index is still below that of 2012, but slightly above 2013 and 2014.



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