Eurozone unemployment hits record 10.8 percent in February

The eurozone unemployment rate hit a 15-year record high of 10.8 percent in February, up from 10.7 percent the previous month, official figures showed on Monday.

The Eurostat data agency estimated that more than 17.1 million men and women were out of work in February after the ranks of the unemployed rose by 1.48 million compared with February 2011.

The seasonally-adjusted unemployment rate also rose to a new record in the wider, 27-nation European Union, hitting 10.2 percent in February compared to 10.1 the previous month.

An estimated 24.55 million people were unemployed in the EU, an increase of 1.87 million from February 2011.

The eurozone’s unemployment rate has risen for 10 consecutive months now as nations across the 17-nation bloc enforce austerity measures to fend off the two-year-old debt crisis.

Eurozone leaders have vowed to install growth and jobs strategies to counter a looming recession but they insist that the budget cuts and structural reforms must continue to restore market confidence.

“Soaring unemployment is clearly adding to the pressure on household incomes from aggressive fiscal tightening in the region’s periphery,» said Jennifer McKeown, senior European economist at Capital Economics research firm.

“But even in Germany, survey measures of hiring point to a downturn to come. And with inflation remaining stubbornly high throughout the eurozone, there is very little hope of a consumer recovery,» McKeown said.

The unemployment rate rose in 18 EU states and fell in eight others compared to a year ago. It remained stable in Romania.

Spain remained the nation with the highest rate at 23.6 percent, followed by Greece at 21 percent. The Greek figures date from December.

The states with the lowest rates were Austria (4.2 percent), the Netherlands (4.9 percent), Luxembourg (5.2 percent) and Germany (5.7 percent).

The new unemployment record followed weak manufacturing data with the Purchasing Managers Index (PMI) sinking to a three-month low in March.

Howard Archer, chief European economist at IHS Global Insight, said eurozone unemployment appears «odds-on» to top 11 percent in 2012 while the economy is likely to have shrunk for a second quarter in a row at the start of the year.

“With the eurozone likely having suffered a further GDP decline in the first quarter of 2012 and in danger of further contraction in the second quarter, and with business confidence still generally weak despite largely coming off the lows at the end of 2011 the likelihood is that the eurozone unemployment rate will move significantly higher,» he said.