Posted by: Dirk | January 15, 2013

Unemployment in Europe – any success stories so far?

There is a lot of talk about success stories in Europe, how this and that country is now back on track and so on. If you doubt the validity of the claim there is a very simple tool which helps you to determine the truths of some of these statements. You go to Google Public Data Explorer, chose Eurostat and then unemployment rates (monthly), scale the timeline so that 2007 (last year before the crisis) is the initial year and define success as bringing a country’s unemployment rate back to the level before the crisis. Here is the actual picture:

euun

There you have it: Germany has done quite well and unemployment has fallen below the value of 2007. Greece and Spain are in a race for worst performer, with 25% unemployment each and no signs of light at the end of the tunnel. Then, Portugal and Ireland are third and fourth, having seemingly stabilized their unemployment rates at about 16 and 15 percent respectively. However, they are not on their way back to unemployment levels in the single digit area. Italy is now above 10% unemployment and rising.

Looking at this picture there can only be one result: no country has yet left the crisis behind, and the only country that appears to have done so (Germany) depends on exports to those that do not. Europe has not done its homework, and while it was supposed to do a group exercise some of the classroom bullys made the smaller kids do a lot of stupid things. All the while, the US has successfully entered the path towards deleveraging and is way ahead.

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