ECONOMY

Downbeat outlook points to growing number of jobless

Greece’s small to medium-sized industrial firms laid off more than 100,000 staff in the second half of 2009, and remain downbeat about the sector’s investment and employment prospects in the first half of this year. The General Confederation of Greek Small Businesses and Traders (GSEVEE), a group representing about 115,000 entrepreneurs across Greece, said that 19 percent of businesses cut payroll costs between July and December, translating into job cuts for more than 104,000 people. «Job losses occurred at a faster rate in manufacturing and larger sized businesses,» GSEVEE said in a statement yesterday. The findings were based on a survey it commissioned in early February among its members, GSEVEE said. The quickly disappearing jobs came in a year when the country’s economy shrunk at an annual rate of 2 percent. Economists expect the Greek economy to continue contracting this year, at an annual rate of somewhere between 2 and 4 percent, which will put additional pressure on the country’s labor market. GSEVEE said that another 60,000 job positions are at risk of being lost in the first half of 2010, according to conservative estimates. Liquidity problems, tumbling demand for products and services and lower turnover were cited as being among the key reasons that will keep investment activity low this year. «Just 8 percent of those questioned expect to increase investments in the coming six months,» GSEVEE added. Deteriorating economic conditions are pointing to a sharp increase in Greece’s unemployment rate, which rose to 10.6 percent in November, reaching a five-year high. Deutsche Bank said last week that the country’s jobless rate could rise to 20 percent this year, twice what the government expects. Turning to measures that can help stimulate economic activity, GSEVEE president Dimitrios Asimakopoulos called on the government to introduce tax incentives for businesses that increase job positions and for European Union funding to help ease the liquidity squeeze in the market. Measures that will «extinguish fires» are necessary, Asimakopoulos told reporters.