Eurostat Data

Recent developments in unemployment at a European and Member State level

Eurostat estimates that 23.022 million men and women in the EU of whom 17.603 million were in the euro area, were unemployed in August 2015. Compared with July 2015, the number of persons unemployed decreased by 33 000 in the EU-28 and increased by 1 000 in the euro area. Compared with August 2014, unemployment fell by 1 490 000 in the EU-28 and by 892 000 in the euro area.

The euro area seasonally-adjusted unemployment rate was 11.0 % in August 2015, stable compared to July 2015, and down from 11.5 % in August 2014. The EU-28 unemployment rate was 9.5 % in August 2015, also stable compared to July 2015, and down from 10.1 % in August 2014.

Among the Member States, the lowest unemployment rates in August 2015 were recorded in Germany (4.5 %), the Czech Republic (5.0 %) and Malta(5.1 %), and the highest in Greece (25.2 % in June 2015) and Spain (22.2 %).

Compared with a year ago, the unemployment rate in August 2015 fell in twenty-three Member States, increased in four and remained stable in Romania. The largest decreases were registered in Estonia (8.0 % to 5.7 % between July 2014 and July 2015), Slovakia (13.2 % to 11.1 %) Spain (24.2 % to 22.2 %), Bulgaria (11.4 % to 9.7 %), Ireland (11.1 % to 9.5 %) and Poland (8.7 % to 7.2 %). The increases were registered in Austria (5.6 % to 5.7 %), Belgium (8.6 % to 8.8 %), France (10.4 % to 10.8 %) and Finland (8.8 % to 9.7 %) .

In August 2015, the unemployment rate in the United States was 5.1 %, down from 5.3 % in July 2015 and from 6.1 % in August 2014.

In August 2015, 4.610 million young persons (under 25) were unemployed in the EU-28, of whom 3.131 million were in the euro area. Compared with August 2014, youth unemployment decreased by 448 000 in the EU-28 and by 262 000 in the euro area. In August 2015, the youth unemployment rate was 20.4 % in the EU-28 and 22.3 % in the euro area, compared with 21.9 % and 23.6 % respectively in August 2014. In August 2015, the lowest rates were observed in Germany (7.0 %), Austria (10.8 %), the Netherlands (11.2 %), Denmark (11.4 %) and Estonia (11.5 % in July 2015), and the highest in Spain (48.8 %), Greece (48.3 % in June2015), Croatia (43.5 % in the second quarter 2015) and Italy (40.7 %).

Unemployment trends

At the beginning of 2000, above 20 million persons were unemployed in the EU-28, corresponding to 9.2 % of the total labour force. The unemployment trend at that moment was downwards. In the second quarter of 2001 the number of unemployment persons had dropped to 19.6 million and the unemployment rate to 8.7 %. A long period of increasing unemployment followed. At the end of 2004 the number of jobseekers available for work reached 21.1 million, while the unemployment rate was 9.2 %.

At the beginning of 2005 a period of steadily declining unemployment started, lasting until the first quarter 2008. At that time, EU-28 unemployment hit a low of 16.1 million persons (equivalent to a rate of 6.8 %) before rising sharply in the wake of the economic crisis. Between the second quarter 2008 and mid-2010 the unemployment level went up by more than 6.6 million, taking the rate up to 9.7 %, at that time the highest value recorded since the start of the series in 2000. The decline of unemployment in the following three quarters was a deceptive sign of an end of the crisis and of a stable improvement in labour market conditions in the EU-28. In fact, since the second quarter 2011 and until the first quarter of 2013 unemployment steadily and markedly increased taking it to the record level of 26.4 million, corresponding to a record rate of 10.9 %. Since then the rate has started to decrease, reaching 9.9 % at the end of 2014.

The unemployment rate in the euro area (EA-18) followed roughly the same trend as in the EU-28. However, between 2000 and the beginning of 2004 the unemployment rate in the euro area was below that recorded in the EU-28. This pattern was subsequently reversed as, between 2005 and the beginning of 2008, unemployment declined more rapidly in the Member States which do not yet have the euro. As in the EU-28, during the economic crisis unemployment increased at a considerable pace, with the exception of the period between mid-2010 and mid-2011 where it temporarily declined. The unemployment level peaked at 19.2 million in the second quarter of 2013, before going down in the second part of 2013 and in the course of 2014.

In 2000, the unemployment rate in the United States was around 4 %, considerably lower than in the EU. It remained much lower until early 2008, when unemployment started to increase rapidly. By the beginning of 2009 the unemployment rate in the United States had reached the same level as in the EU-28, and stayed above the EU-28 rate until the beginning of 2010. Since then the US unemployment rate has followed a downwards path which has taken it to 5.7 % at the end of 2014. In Japan, between 2000 and 2014, unemployment rates were much lower than in the EU, ranging between 3.5 % in the fourth quarter 2014 and 5.4 % in the third quarter 2009, when the rate started declining.

Youth unemployment trends

Youth unemployment rates are generally much higher, even double or more than double, than unemployment rates for all ages. As for the rate for the total population, the youth unemployment rate in the EU-28 sharply declined between 2005 and 2007, reaching its minimum value (15.2 %) in the first quarter 2008. The economic crisis, however, severely hit the young. From the second quarter of 2008, the youth unemployment rate has taken an upward trend peaking in 23.8 % in the first quarter 2013, before receding to 21.4 % at the end of 2014. The EU-28 youth unemployment rate was systematically higher than in the euro area between 2000 and mid-2007. Since then and until the third quarter 2010 these two rates were very close. Afterwards the indicator moved more sharply in the EA-18 than in the EU-28, first downwards until mid-2011, then upwards until the end of 2012 (see also Figure 5). In the middle of 2012 the euro area youth unemployment rate overtook the EU-28 rate, and the gap increased until the end of the year. The gap became even larger in the second part of 2013 and during 2014, when the rate for the euro area went down less than the rate for the EU-28.

High youth unemployment rates do reflect the difficulties faced by young people in finding jobs. However, this does not necessarily mean that the group of unemployed persons aged between 15 and 24 is large, as many young people are studying full-time and are therefore neither working nor looking for a job (so they are not part of the labour force which is used as the denominator for calculating the unemployment rate). For this reason, youth unemployment ratios are also calculated, according to a somewhat different concept: the unemployment ratio calculates the share of unemployed for the whole population. Table 1 shows that youth unemployment ratios in the EU are much lower than youth unemployment rates; they have however also risen since 2008 due to the effects of the crisis on the labour market.

Male and female unemployment trends

Historically, women have been more affected by unemployment than men. In 2000, the unemployment rate for women in the EU-28 was around 10 %, while the rate for men was below 8 %. By the end of 2002, this gender gaphad narrowed to around 1.5 percentage points and between 2002 and mid-2007 this gap remained more or less constant. Since the first quarter of 2008, when they were at their lowest levels of 6.3 % and 7.4 % respectively, the male and female unemployment rates in the EU-28 converged, and by the second quarter of 2009 the male unemployment rate was higher. The decline of the men’s rate during 2010 and the first half of 2011 and the corresponding stability in the women’s rate over the same period brought the male rate below the female one once again. Since then the two rates have risen at the same pace until mid-2013, when they reached their highest value, both at 10.9 %. In the second half of 2013 as well as during the course of 2014 both the male and the female rates declined, reaching respectively 9.8 % and 10.1 % at the end of 2014.

A detailed look at 2014

The overall unemployment rate in the EU-28 reached 10.2 % in 2014, decrease of 0.7 percentage points compared with 2013. This follows an increase of 0.4 percentage points between 2012 and 2013. In the United States the unemployment rate fell for the fourth year in a row, from 7.4 % in 2013 to 6.2 % in 2014.

The unemployment rate rose in 6 Member States between 2013 and 2014, dropped in 19 and remained stable in France, Croatia and Luxembourg. The increases in the annual average unemployment rates between 2013 and 2014 were recorded in Italy (+0.6 ppt), Finland (+0.5 ppt), Cyprus and Austria (both +0.2 ppt) as well as in Belgium and the Netherlands (both +0.1 ppt). The highest decreases were reported in Hungary (-2.5 ppt), Portugal (-2.3 ppt), Ireland (-1.8 ppt), Spain and Bulgaria (both -1.6 ppt) and the United Kingdom (-1.5 ppt). With 26.5 %, Greece was the country with the highest overall unemployment rate in 2014. The dispersion of unemployment across the EU-28 remained at approximately the same level as in 2013.

Long-term unemployment is one of the main concerns of policymakers. Apart from its financial and social effects on personal life, long-term unemployment negatively affects social cohesion and, ultimately, may hinder economic growth. In total, 5.1 % of the labour force in the EU-28 in 2014 had been unemployed for more than one year; more than half of these, 3.1 % of the labour force, had been unemployed for more than two years. Compared to 2013, a decrease is observed in the long term unemployment (from 5.2 %) while a sizeable increase (from 2.9 %) is registered among those being unemployed for two or more years.

For the first time since the calculation of EU-28 unemployment statistics started (in 2000), the unemployment rate for women was lower than that for men in 2009, and remained so in 2010. In 2011, this effect reversed again, with female unemployment rates at 9.7 % against 9.6 % for males. The gap has remained unchanged until 2013, when the two rates for the EU-28 peaked at 10.8 % for men and 10.9 % for women. In the euro area the rate has always been higher for women than for men. In 2014 the rates stood at 11.5 % for men and at 11.8 % for women. Male unemployment rates were higher than the corresponding rates for women during 2014 in 15 out of 28 Member States. The gap between male and female unemployment rates varied from -6.5 percentage points in Greece to +3.5 percentage points in Ireland.

The youth unemployment rate in the EU-28 was more than double the overall unemployment rate in 2014. At 22.2 %, more than one out of every five young persons in the labour force was not employed, but looking and available for a job. In the euro area, the youth unemployment rate was even higher at 23.8 %. The unemployment rate among young persons was higher than the rate for those aged between 25 and 74 in all Member States. In Spain (53.2 %), Greece (52.4 %), Croatia (45.5 %), Italy (42.7 %), Cyprus (35.9 %) and Portugal (34.7 %) youth unemployment rates were particularly high. Germany (7.7 %) was the only Member State with a youth unemployment rate below 10 %.

Educational qualifications are still the best insurance against unemployment, which clearly increases the lower the level of education attained. The average unemployment rate in the EU-28 for those aged between 25 and 64 having attained at most a lower secondary education was 18.2 %, much higher than the rate of unemployment for those that had obtained a tertiary education qualification (6.6 %).

Data sources and availability

An unemployed person is defined by Eurostat, according to the guidelines of the International Labour Organization, as someone aged 15 to 74 without work during the reference week who is available to start work within the next two weeks and who has actively sought employment at some time during the last four weeks. The unemployment rate is the number of people unemployed as a percentage of the labour force.

In addition to the unemployment measures covered here, Eurostat also publishes statistics for persons who fulfil only partially the definition of unemployment. These persons are not included in the official ILO unemployment concept and have a varying degree of attachment to the labour market. The indicators on underemployment and potential additional labour force participants supplement the unemployment rate to provide a more complete picture of the labour market.

There is currently no specific legal basis for producing and disseminating monthly unemployment data. However, these monthly data are estimates based on results of the European Union Labour force survey (EU LFS), which is a continuous household survey carried out in all Member States in accordance with European legislation and on the basis of harmonised definitions. These results are interpolated/extrapolated to monthly data using national survey data and/or national monthly series on registered unemployment. The quarterly LFS results are always used as a benchmark to ensure international comparability. As for most Member States the results from the LFS for a full quarter are available 90 days after the end of the reference period, the most recent figures are usually provisional. For many countries monthly unemployment data are calculated by Eurostat, while several countries actually supply those figures directly from the LFS.

The following LFS data are used in the calculations of the monthly unemployment rates published in this article:

• For the Czech Republic, Germany, Italy, the Netherlands, Austria, Romania, Finland and Sweden: monthly LFS data up to and including August 2015.
• For Greece: monthly data up to and including June 2015.
• For Denmark and Portugal: monthly data (3 month moving average) up to and including July, August and September 2015.
• For Estonia and Hungary: monthly data (3 month moving average) up to and including June, July and August 2015.
• For the United Kingdom: monthly data (3 month moving average) up to and including May, June and July 2015.
• For Belgium, Bulgaria, Ireland, France, Croatia, Cyprus, Latvia, Lithuania, Luxembourg, Malta, Poland, Slovenia, Slovakia and Spain: quarterly data up and including Q2 2015.

Monthly unemployment and employment series are calculated first at the level of four categories for each Member State (males and females 15-24 years, males and females 25-74 years). These series are then seasonally adjusted and all the national and European aggregates are calculated. Monthly unemployment figures are published by Eurostat as rates (as a percentage of the labour force) or levels (in thousands), by gender and for two age groups (persons aged 15-24, and those aged 25-74). The figures are available as unadjusted, seasonally adjusted andtrend series. There are monthly estimates for all EU-28 Member States. Data for the EU-28 aggregate start in 2000 and for the euro area (EA-18) in April 1998; the starting point for individual Member States varies.

Member States may publish other rates such as register-based unemployment rates, or rates based on the national LFS or corresponding surveys. These rates may vary from those published by Eurostat due to a different definition or methodological choices.

Context

The unemployment rate is an important indicator with both social and economic dimensions. Rising unemployment results in a loss of income for individuals, increased pressure with respect to government spending on social benefits and a reduction in tax revenue. From an economic perspective, unemployment may be viewed as unused labour capacity.

The International Labour Organization definition of the unemployment rate is the most widely used labour market indicator because of its international comparability and relatively timely availability. Besides the unemployment rate, indicators such as employment and job vacanciesalso give useful insights into labour market developments.

The time series on unemployment are used by the European Commission, other public institutions, and the media as an economic indicator; banks may use the data for business cycle analysis. Finally, the general public might also be interested in changes in unemployment.

The unemployment rate is considered to be a lagging indicator. When there is an economic downturn, it usually takes several months before the unemployment rate begins to rise. Once the economy starts to pick up again, employers usually remain cautious about hiring new staff and it may take several months before unemployment rates start to fall.

Male, youth and long-term unemployment appear to be more susceptible to cyclical economic changes than overall unemployment. Indeed, social policymakers often face the challenge of remedying these situations by designing ways to increase employment opportunities for various groups of society, those working in particular economic activities, or those living in specific regions.

Globalisation and technological progress have an ever-increasing effect on daily life, and the demand for different types of labour and skills is evolving at a rapid pace. While enterprises try to improve their productivity and become more competitive and innovative, they may well seek to pass on risk to the labour force through greater flexibility - both in relation to those already in employment, as well as those searching for a new job. Within the context of the http://ec.europa.eu/eurostat/statistics-explained/skins/statexpflat/media/external.png) 100% 50% no-repeat;">European employment strategy (EES), there are a number of measures that are designed to help encourage people to remain in work or find a new job, including: the promotion of a life-cycle approach to work, encouraging lifelong learning, improving support to those seeking a job, as well as ensuring equal opportunities. The http://ec.europa.eu/eurostat/statistics-explained/skins/statexpflat/media/external.png) 100% 50% no-repeat;">integrated employment guidelines for 2008-2010encouraged Member States, among others, to:

•work with renewed endeavour to build employment pathways for young people and reduce youth unemployment, in particular, through adapting education and training systems in order to raise quality, broaden supply, diversify access, ensure flexibility, respond to new occupational needs and skills requirements, and; •take action to increase female participation and reduce gender gaps in employment, unemployment and pay, through better reconciliation of work and private life and the provision of accessible and affordable childcare facilities and care for other dependants. The guidelines also set a number of additional benchmarks, whereby Member States were encouraged: •to ensure that by 2010 every unemployed person is offered a job, apprenticeship, additional training or another employability measure (for young persons leaving school within four months, and for adults within no more than 12 months), and; •to work towards 25 % of the long-term unemployed participating in training, retraining, work practice, or other employability measures by 2010.

The current economic crisis has however reversed much of the progress achieved in Europe since 2000. The http://ec.europa.eu/eurostat/statistics-explained/skins/statexpflat/media/external.png) 100% 50% no-repeat;">Europe 2020 strategy put forward by the European Commission sets out a vision of Europe's social market economy for the 21st century. As part of the flagship initiatives, 'http://ec.europa.eu/eurostat/statistics-explained/skins/statexpflat/media/external.png) 100% 50% no-repeat;">An agenda for new skills and jobs' and 'http://ec.europa.eu/eurostat/statistics-explained/skins/statexpflat/media/external.png) 100% 50% no-repeat;">Youth on the move', (youth) unemployment rates will be targeted via by a range of policies, including proposals aimed at education and training institutions, or measures for the creation of a (work) environment conducive to higher activity rates and higher labour productivity. There are also initiatives aimed at improving the entry rate of young people into the labour market.