For all the continued momentum in the euro-area recovery, differing prospects for young people across the bloc show the wounds of the debt crisis remain very raw.
The unemployment rate for those under age 25 was at 19.4 percent in February, according to data on Monday. While that’s an improvement compared with a year ago — and is the lowest since 2009 — it’s more than twice the total for the euro-area of 9.5 percent. In four southern European countries — Greece, Spain, Italy and Cyprus — at least three in 10 young people are still out of work.
European Central Bank President Mario Draghi last month highlighted the improving jobs figures as proof that the central bank’s quantitative easing isn’t just boosting asset prices and widening inequality, but benefiting ordinary citizens. Still, the latest jobless numbers indicate the level of slack still in the labor market, even as the headline rate has come down from its peak of more than 12 percent four years ago.
“We’re still very far away from the wage growth we saw pre-crisis,” said Bert Colijn, senior euro-area economist at ING Bank NV in Amsterdam. “With labor market conditions as slack as they are, and with youth unemployment still quite high, it seems that Draghi will probably need to remain cautious until we really see some strengthening labor market signs.”
Euro-area inflation slowed for the first time in nearly a year in the euro area last month and economic confidence unexpectedly dipped, muffling some of the calls on Draghi to begin moving toward unwinding stimulus. Still, factory growth accelerated to the highest since 2011, adding to evidence that the recovery is firming.