Euro Area: Unemployment rate inches down in November
Labor market conditions in the common currency block improved in November. The number of unemployed people decreased by 172,000, while the unemployment rate dipped to 8.3% in November from 8.4% in October.
That said, short-time work schemes involving a considerable portion of the labor force across the Eurozone have prevented a jump in the unemployment rate.
Looking at countries with available data, six economies saw their unemployment rate decrease in November, including Italy and the Netherlands. Meanwhile, five countries saw their unemployment rate increasing, including France and Spain. The rest saw a stable unemployment rate.
Disparities in the labor market among core and periphery countries persist. Spain is the economy with the highest unemployment rate (16.4%), followed by Greece (16.1%, data refers to September). At the other end of the spectrum, the Netherlands (4.0%), Germany (4.5%) and Malta (4.8%), have the lowest unemployment rates.
Commenting on the release, Bert Colijn, senior economist at ING, stated:
“Policy has massively suppressed unemployment over the course of 2020, in part avoiding joblessness, but also in part delaying it. Bankruptcies are a very uncertain factor for this year, but are likely to increase, which will increase unemployment. The end of short-time work schemes and the negative impact from the second wave will likely do the same. So while unemployment developments are very encouraging up to November, it is still likely to run up again this year, setting the stage for an M-shaped unemployment pattern.”