Wednesday, May 1, 2013

Global Unemployment on the Rise

Looking at the medium-term, the forecast global economic recovery is not expected to be strong enough to bring down unemployment quickly, and the number of jobseekers is expected to rise to more than 210 million over the next five years.
The labour market situation remains particularly bleak for the world’s youth, with almost 74 million people in the 15 to 24 age group unemployed around the world – a 12.6 per cent youth unemployment rate.

Of particular concern is the fact that more and more young people experience long-term unemployment. Some 35 per cent of unemployed youth in advanced economies have been out of a job for six months or longer. As a consequence, increasing numbers of young people are getting discouraged and leaving the labour market.
In Europe
Some 19 million people are out of work in the eurozone, 3.6 million of them under the age of 25, meaning nearly one in every four young people are without a job.
Compared with the same month a year earlier, the jobless total in the eurozone has increased by 1.8 million, with the depressed economies of southern Europe suffering the most.
There is little hope that Europe will return to growth this quarter, especially in the wake of a messy and tumultuous bailout for the tiny nation of Cyprus.
With unemployment at unprecedented levels in the EU, the risk of social unrest is rising, says the UN’s International Labour Organization. The ILO is warning politicians to abandon austerity and embrace job creation.
“When unemployment is as high as it is right now – as poverty and welfare protection become worse – then the danger of social unrest grows along with it,” says Miguel Angel Malo.
Malo is a professor of economics in Salamanca, Spain – a country where youth unemployment is at 56 percent. Additionally he’s an economics expert at the International Labour Organization (ILO), a UN agency seeking to promote labor rights.
It was for the ILO that Malo co-authored a paper with an unsettling thesis: the likelihood of social unrest is increasing. Or at least, it’s becoming far more likely in certain areas of Europe.
In America
The US Labour department announced that US employers added just 88,000 jobs in March. This number is the fewest in nine months indicating a sharp retreat after a period of strong hiring.
According to the Department the unemployment rate dipped to 7.6 percent from 7.7 percent. However, Associated Press reported that even though that is the lowest figure in four years, the rate fell only because more people stopped looking for work.
The drop in retail employment was a major factor for the March’s figures. The data from the Labour Department showed that the retail sector lost 24,000 jobs in March. At the same time, 12,000 jobs were lost in the US Postal Service.
Overall, March’s job gains were half the pace of the previous six months, when the economy added an average of 196,000 jobs a month. Paul Dales, an economist at Capital Economics told BBC, “when you get to numbers below 100,000, you have to start worrying.”
The drop raises fears that the US economy could slow after a stronger winter.
In Australia
Australia’s jobless rate jumped 0.2 percentage points to 5.6 percent in March with 36,100 fewer people employed, following a sharp rise in positions created the previous month.
The Australian Bureau of Statistics said the unemployment rate was up from 5.4 percent, defying analysts, who had broadly tipped the rate to remain steady.
The number of jobs lost, seasonally adjusted, was nearly half the upwardly revised 74,000 gained in February, a result that was a near 13-year high and smashed forecasts.
The Australian dollar dropped on the data to US$1.0517 from US$1.0537 on expectations that the central bank is more likely to ease interest rates if the labor market weakens.
Both part-time and full-time employment fell in March with the participation rate – the proportion of people in work or looking for work – at 65.1 percent, down from 65.3 percent in February.

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