ECONOMY

Unemployment hits 10-yr high

Greek unemployment jumped to a 10-year high in the first quarter, data showed yesterday, and is expected to keep rising through 2010, as recently adopted austerity measures extend a year-long recession. The jobless rate rose to 11.7 percent, or to just under 586,800 people, from 9.3 percent in the same quarter last year, the Hellenic Statistical Authority (ELSTAT) said in a statement yesterday. That’s the highest rate since 2000, when unemployment was 12.3 percent. Greece has cut spending, raised taxes and trimmed wages and pensions to tackle a budget shortfall of 13.6 percent of gross domestic product in 2009, more than four times the European Union’s limit. The Greek economy contracted 2.5 percent in the three months to March 31 and industrial output fell 5.1 percent in April. The government expects the austerity measures will exacerbate the country’s recession and lead the economy to contract 4 percent this year, twice the 2009 pace, and shrink another 2.6 percent next year. The Greek jobless rate was more than one in five people among those aged 15 to 29, the worst-affected age group, followed by a 10.9 percent rate for those aged 30 to 44, the authority said. The unemployment rate was highest in the Ionian Islands, which include the popular tourist destination of Corfu, at 20.4 percent. The number of jobless in Athens and its surrounding area rose to 10.7 percent from 7.6 percent a year earlier. Economists said labor market conditions are expected to keep deteriorating, particularly in the third quarter of the year, as the austerity measures bite. According to the International Monetary Fund, which is co-funding Greece over the next three years in a 110-billion-euro bailout program, the country’s jobless rate is seen jumping to 14.6 percent in 2011 from 11.8 percent this year. This is projected to peak at 14.8 percent in 2012. Greece’s jobless rate in the first three months of the year was 1.6 percentage points higher than the average unemployment rate in the 16 countries sharing the euro, which rose to a nearly 12-year high in April.