Growth in the eurozone remained stable in the third quarter, but at a low level of 0.2%, indicating a stagnation of activity in Europe.
Inflation remains at very low levels.
The index reported by European statisticians slowed in October to 0.7%, well below the European Central Bank (ECB) target of a level “close to but below 2%.”
A significant decrease over a year
On a monthly basis, the number of unemployed increased by 48,000 in August. It affects 15.6 million people in the 28 countries and 33,000 in the eurozone. Year-on-year, the decrease is significant with 889,000 fewer people in the EU-28 and 738,000 fewer in the monetary zone. In the eurozone, the unemployment rate stood at 6.3% in September, its lowest level since July 2008 before the Great Recession.
Stark disparities
Despite these favorable figures, disparities remain very pronounced across the continent. Last September, the lowest rates were in the Czech Republic (2.1%), Germany (3.1%), and Poland (3.3%). Conversely, Greece (16.9%), Spain (14.2%), and Italy (9.9%) are the countries most affected by this phenomenon. France ranks fourth with an unemployment rate of 8.4% according to the international bureau. These results illustrate the lasting effects of the 2008 crisis and the sovereign debt crisis in the eurozone, creating a real contrast between northern and southern Europe.
Youth unemployment is rising again
Regarding youth unemployment, the figures are less positive. After a steady decline since 2016, the rate has tended to stagnate in recent months, approaching 16% in the eurozone and 14.5% in the European Union. Again, southern European countries are particularly affected by this plague. In Spain, the unemployment rate for those under 25 reaches 32.8% compared to 28.7% in Italy and 19.4% in Spain. In contrast, the Czech Republic (4.4%), Germany (5.9%), and the Netherlands (7.2%) are much less affected.
Slowing growth in the eurozone
For several months, cyclical indicators have been darkening in Europe. In the third quarter of 2019, the gross domestic product (GDP) increased by only 0.2% in the eurozone and in the EU-28. This is a pace far below what was recorded in the first quarter (0.4%). In the monetary union, this pace identical to the second quarter clearly confirms the sharp slowdown in activity. Indeed, the quarterly progression had never been so low since the second quarter of 2014 according to Eurostat data in the 19-member monetary area.
