ECONOMY

Jobless rate hits a 10-year high

Greece’s unemployment hit a 10-year high in the third quarter with austerity measures promised in exchange for funding from the International Monetary Fund and the European Union expected to further weigh on the labor market. The jobless rate rose to 12.4 percent in the three months to September, from 11.8 percent in the second quarter and 9.3 percent in the same period a year earlier, the Hellenic Statistical Authority (ELSTAT) said yesterday. The statistics service said the number officially out of work was 621,938, with unemployment a much higher 24.2 percent in the 15-29 age group. Conditions are worst in northern Greece’s Macedonia region where the unemployment rate is in the range of 13.2 to 14.8 percent. Jobs fast dried up in the manufacturing and construction sectors over the last year as a total of almost 140,000 positions disappeared across all sectors in 12 months, ELSTAT data showed. Economists at Alpha Bank see unemployment averaging at 12.3 percent in 2010, up from 9.4 percent in 2009 and 7.4 percent in 2008. The bank said in a weekly report released yesterday that the jobless rate is seen rising to 14.3 percent next year, below the 15 percent expected by Greece and its international lenders, with tourism sector growth and government measures boosting employment seen as cushioning the effect of the recession. «There are signs that point to a significant increase in flexible forms of employment and this will help in the fast reduction of jobless numbers,» said the bank. In October, the Labor Ministry announced a state program co-funding the employment of 10,000 people aged up to 24, while other incentives providing for more flexible work conditions have also been approved. In September Greece’s jobless rate was 2.3 percentage points higher than the average in the 16 countries that share the euro but lower than Spain’s 19.8 percent unemployment. Greece has been in recession for more than two years, with the economy shrinking an annual 4.6 percent in the third quarter after the government slashed spending and raised taxes in an effort to narrow a budget deficit of 15.4 percent of gross domestic product in 2009. The economy is forecast to stop contracting in the second half of 2011.