Unemployment hits 8-year high in Italy


Rome : Italian unemployment in January rose to an eight-year high of 9.2 percent as the euro zone’s third-biggest economy implements economic and labour reforms amid a recession.

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January joblessness rose 1 percent to more than 2.3 million over the same month in 2011 and was up 0.2 percent from December, marking the toughest job market since 2004 when Italy first started keeping monthly employment figures, national statistics agency Istat said Thursday in a statement of its preliminary data.

Spain has the highest unemployment rate at 23.3 percent, while Austria has the lowest at 4 percent.

European Union statistics agency Eurostat said the unemployment rate in the 27 EU members reached 10.1 percent last month, representing 24.3 million people out of work.

In Italy, young workers – defined as those between 15 and 24 years old – were the hardest hit, with almost one-third, or 31.1 percent, without work.

Italy’s unemployment was better than the 10.7 percent average for the 17 countries that use the euro currency, the so-called euro zone were in January there were 16.9 million people without jobs.

Businesses are trimming their workforce and otherwise holding back on hiring as confidence in the economy stumbles. An emergency government led by Prime Minister Mario Monti implemented tax hikes, pension reforms and launched a high-profile war on endemic tax evasion to balance the budget and lower Italy’s 1.9 trillion euros in debt.

Monti and a team of non-elected technocrats took over the government in November after the cost of borrowing was rising to unsustainable levels, creating concern that Italy would default and sink the euro currency with it.

Monti has bowed to calls for reduced national spending, while critics say just the opposite is needed to put money in consumers’ pockets and boost the economy.

The Italian economy during the fourth quarter shrank by 0.7 percent, the second consecutive quarter of contraction. The International Monetary Fund forecasts the economy will shrink 2.2 percent this year.