Unemployment in the area of 17 countries rose to 10.8% in February, as economists polled by Reuters expected, a figure that can be compared with the 10.7% seen in January, said on Monday the statistics agency Eurostat.
“We hope to continue rising until we reach 11% later this year,” said Raphael Brun-Aguerre, economist at JP Morgan in London. There hasn’t been an unemployment level this critic since 1997. In the European Union the unemployment rate was 10.2%, up from 10.1% in January.
The debt crisis has forced European governments to cut on spending, leaving many Europeans with troubles at finding jobs as the eurozone goes into recession. The European Comission expects production in the euro area to shrink by 0.3% in 2012, and it has been shown that manufacturing activity in the block decreased for the eighth consecutive month in March.
Economists cannot conclude whether is right or not to lower fiscal deficits aggressively, as the economic downturn affects tax revenues and the ability of consumers to spend. However the Commission says that lower public debt will regain investor’s confidence after the block allows its debts to grow in poor control.