Social Europe

politics, economy and employment & labour

  • Themes
    • Strategic autonomy
    • War in Ukraine
    • European digital sphere
    • Recovery and resilience
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Podcast
  • Videos
  • Newsletter

Why Such Disparity Between Unemployment Rates In Europe?

Denis MacShane 27th July 2018

Denis MacShane

Denis MacShane

Eurostat has just published its latest unemployment figures. For the EU and Eurozone. Overall, they show continuing progress though youth unemployment remains seriously high.

But the statistics do not explain why some countries have much higher rates of joblessness than others with Greece posting nearly ten times the rate of unemployment as the Czech Republic and Spain, the same size as Poland, having nearly five times as many out of work as the EU’s most easterly member state.

Screen Shot 2018 07 05 at 10.00.17

One of the most curious aspects is how well the former communist countries have done in getting unemployment down to very low levels. The transition to a market economy has been rough but with Czechia, Hungary and Poland all posting unemployment rates below that of Britain, where commentators boast endlessly of the UK’s high levels of job creation, it would seem that former communist economies have adapted well.

Romania, Bulgaria and Estonia have lower unemployment than the EU’s three Nordic member states – Denmark, Sweden and Finland – that are often held up by progressives as labour market models to follow and emulate.


Our job is keeping you informed!


Subscribe to our free newsletter and stay up to date with the latest Social Europe content. We will never send you spam and you can unsubscribe anytime.

Sign up here

Ten years ago, as the financial crisis broke, everyone wrote of the PIGS – Portugal, Ireland, Greece and Spain – as the bankrupt nations that would probably have to exit the Euro to survive and perhaps even suspend EU membership.

Yet, today Irish unemployment stands at 5.3%, a shade above the UK level, and Portugal’s at 7.3% with Lisbon appealing to nurses and other Portuguese workers in Brexit Britain to return home as labour shortages are appearing.

Jobs puzzle

So why have Italy and Greece been unable to cut their unemployment rates as Portugal and Ireland have done?

It is fashionable for left-wing UK commentators like Owen Jones and Paul Mason and their equivalents in European capitals to blame Brussels, austerity or, in the case of Greece, Berlin with Greek supporters of Syriza in 2015 painting Hitler moustaches onto Angela Merkel’s lips on protest posters.

But the same EU and Eurozone policies have been applied elsewhere and produced big drops in unemployment.

There seems no correlation either with the colour of the government. Spain was ruled by socialists until 2012 and has just booted out the centre-right PP government but unemployent remains stubbornly high. Greece switched from a conservative New Democracy team in 2015 to Europe’s most left government – at least in terms of the rhetoric of Yanis Varoufakis – but has been unable to tackle unemployment seriously (It was 22.1 per cent a year ago).

Political puzzle

A common explanation of the rise of right-wing populist, xenophobic and nationalist governments (or the Brexit result) is that those without jobs, or income or who feel the losers and left-behinds of Europe’s version of globalisation take their revenge by voting in right-wing anti-immigrant governments.

Yet again, it is the EU member states with the highest job-creation records – Hungary, Poland, Austria, Slovakia or Czechia which have voted into power illiberal, and Muslim-baiting political parties hostile to media freedom or European integration values.


We need your support


Social Europe is an independent publisher and we believe in freely available content. For this model to be sustainable, however, we depend on the solidarity of our readers. Become a Social Europe member for less than 5 Euro per month and help us produce more articles, podcasts and videos. Thank you very much for your support!

Become a Social Europe Member

Nor is it possible to read across trade union density with unemployment. France has the lowest number of workers paying membership dues to trade unions – eight per cent of the workforce – but twice the level of unemployment as Hungary and Poland where unions organise 12 per cent of the workforce according to European Trade Union Institute figures.

Those who claim that the creation of the Euro is an unqualified success have to explain why in May 2018 of the 3.377 billion young persons who were unemployed in the EU28 two-thirds – 2.390bn – were in the euro area.

The figures show an improvement as the overall pick-up in the total EU economy (minus Brexit Britain) continues. Compared with May 2017, youth unemployment decreased by 519,000 in the EU28 and by 353,000 in the euro area. In May 2018, the youth unemployment rate was 15.1per cent in the EU28 and 16.8 per cent in the euro area, compared with 17.2 per cent and 19.3 per cent respectively a year earlier. Nevertheless, the highest levels of youth unemployment were all in Euro member states – Greece (43.2 per cent in March 2018), Spain (33.8 per cent) and Italy (31.9 per cent). Why?

The latest EU statistics show fascinating variations which surely deserve some closer analysis. If Europe is to hold together it must understand the modern world of employment and why some nations are better at creating jobs than others.

Ed: Some have tried to answer the author’s question. See here and here and here or here

Denis MacShane

Denis MacShane was a Labour MP (1994-2012) and served as UK minister of Europe. He writes regularly on European politics and Brexit.

You are here: Home / Politics / Why Such Disparity Between Unemployment Rates In Europe?

Most Popular Posts

European civil war,iron curtain,NATO,Ukraine,Gorbachev The new European civil warGuido Montani
Visentini,ITUC,Qatar,Fight Impunity,50,000 Visentini, ‘Fight Impunity’, the ITUC and QatarFrank Hoffer
Russian soldiers' mothers,war,Ukraine The Ukraine war and Russian soldiers’ mothersJennifer Mathers and Natasha Danilova
IGU,documents,International Gas Union,lobby,lobbying,sustainable finance taxonomy,green gas,EU,COP ‘Gaslighting’ Europe on fossil fuelsFaye Holder
Schengen,Fortress Europe,Romania,Bulgaria Romania and Bulgaria stuck in EU’s second tierMagdalena Ulceluse

Most Recent Posts

EU social agenda,social investment,social protection EU social agenda beyond 2024—no time to wasteFrank Vandenbroucke
pension reform,Germany,Lindner Pension reform in Germany—a market solution?Fabian Mushövel and Nicholas Barr
European civil war,iron curtain,NATO,Ukraine,Gorbachev The new European civil warGuido Montani
artists,cultural workers Europe’s stars must shine for artists and creativesIsabelle Van de Gejuchte
transition,deindustrialisation,degradation,environment Europe’s industry and the ecological transitionCharlotte Bez and Lorenzo Feltrin

Other Social Europe Publications

front cover scaled Towards a social-democratic century?
Cover e1655225066994 National recovery and resilience plans
Untitled design The transatlantic relationship
Women Corona e1631700896969 500 Women and the coronavirus crisis
sere12 1 RE No. 12: Why No Economic Democracy in Sweden?

ETUI advertisement

Social policy in the European Union: state of play 2022

Since 2000, the annual Bilan social volume has been analysing the state of play of social policy in the European Union during the preceding year, the better to forecast developments in the new one. Co-produced by the European Social Observatory (OSE) and the European Trade Union Institute (ETUI), the new edition is no exception. In the context of multiple crises, the authors find that social policies gained in ambition in 2022. At the same time, the new EU economic framework, expected for 2023, should be made compatible with achieving the EU’s social and ‘green’ objectives. Finally, they raise the question whether the EU Social Imbalances Procedure and Open Strategic Autonomy paradigm could provide windows of opportunity to sustain the EU’s social ambition in the long run.


DOWNLOAD HERE

Eurofound advertisement

Eurofound webinar: Making telework work for everyone

Since 2020 more European workers and managers have enjoyed greater flexibility and autonomy in work and are reporting their preference for hybrid working. Also driven by technological developments and structural changes in employment, organisations are now integrating telework more permanently into their workplace.

To reflect on these shifts, on 6 December Eurofound researchers Oscar Vargas and John Hurley explored the challenges and opportunities of the surge in telework, as well as the overall growth of telework and teleworkable jobs in the EU and what this means for workers, managers, companies and policymakers.


WATCH THE WEBINAR HERE

Foundation for European Progressive Studies Advertisement

Discover the new FEPS Progressive Yearbook and what 2023 has in store for us!

The Progressive Yearbook focuses on transversal European issues that have left a mark on 2022, delivering insightful future-oriented analysis for the new year. It counts on renowned authors' contributions, including academics, politicians and analysts. This fourth edition is published in a time of war and, therefore, it mostly looks at the conflict itself, the actors involved and the implications for Europe.


DOWNLOAD HERE

Hans Böckler Stiftung Advertisement

The macroeconomic effects of re-applying the EU fiscal rules

Against the background of the European Commission's reform plans for the Stability and Growth Pact (SGP), this policy brief uses the macroeconometric multi-country model NiGEM to simulate the macroeconomic implications of the most relevant reform options from 2024 onwards. Next to a return to the existing and unreformed rules, the most prominent options include an expenditure rule linked to a debt anchor.

Our results for the euro area and its four biggest economies—France, Italy, Germany and Spain—indicate that returning to the rules of the SGP would lead to severe cuts in public spending, particularly if the SGP rules were interpreted as in the past. A more flexible interpretation would only somewhat ease the fiscal-adjustment burden. An expenditure rule along the lines of the European Fiscal Board would, however, not necessarily alleviate that burden in and of itself.

Our simulations show great care must be taken to specify the expenditure rule, such that fiscal consolidation is achieved in a growth-friendly way. Raising the debt ceiling to 90 per cent of gross domestic product and applying less demanding fiscal adjustments, as proposed by the IMK, would go a long way.


DOWNLOAD HERE

ILO advertisement

Global Wage Report 2022-23: The impact of inflation and COVID-19 on wages and purchasing power

The International Labour Organization's Global Wage Report is a key reference on wages and wage inequality for the academic community and policy-makers around the world.

This eighth edition of the report, The Impact of inflation and COVID-19 on wages and purchasing power, examines the evolution of real wages, giving a unique picture of wage trends globally and by region. The report includes evidence on how wages have evolved through the COVID-19 crisis as well as how the current inflationary context is biting into real wage growth in most regions of the world. The report shows that for the first time in the 21st century real wage growth has fallen to negative values while, at the same time, the gap between real productivity growth and real wage growth continues to widen.

The report analysis the evolution of the real total wage bill from 2019 to 2022 to show how its different components—employment, nominal wages and inflation—have changed during the COVID-19 crisis and, more recently, during the cost-of-living crisis. The decomposition of the total wage bill, and its evolution, is shown for all wage employees and distinguishes between women and men. The report also looks at changes in wage inequality and the gender pay gap to reveal how COVID-19 may have contributed to increasing income inequality in different regions of the world. Together, the empirical evidence in the report becomes the backbone of a policy discussion that could play a key role in a human-centred recovery from the different ongoing crises.


DOWNLOAD HERE

About Social Europe

Our Mission

Article Submission

Membership

Advertisements

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Social Europe Archives

Search Social Europe

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Follow us

RSS Feed

Follow us on Facebook

Follow us on Twitter

Follow us on LinkedIn

Follow us on YouTube