'Catastrophic' rise in youth unemployment if Greece left eurozone

Fri, 31/08/2012 - 12:24 -- nick

The UN's International Labour Organisation (ILO) has warned of a "catastrophic" rise in unemployment, especially among the young, if debt-wracked Greece were to leave the eurozone or if the bloc were to split.

"It would be a catastrophe for the European youth," Ekkehard Ernst, a senior economist at the body told the German daily Sueddeutsche Zeitung.

Unemployment in crisis-hit Spain would rise to 27.7pc by 2014, the ILO economist calculated, with jobless rates among 15-24 year-olds rising to 51.3pc. Portugal would also suffer a crippling rise in unemployment, AFP reported.

In Germany, Europe's top economy, which is currently enjoying unemployment rates near record lows, close to one-in-10 would be without a job by 2014.

"The average unemployment rate in the 17 eurozone member states would rise to 13pc," Mr Ernst told the paper.

The situation would be even worse if the single currency zone were to break up completely, cautioned the economist.

In this event, unemployment in Germany would shoot up to 11.3pc by 2014 and stay around this level. France would see its jobless rate spike to 17pc and more than one-in-three Spaniards would be without a job.

Again, the young would be worst hit, said Mr Ernst. If the euro were to crash, youth unemployment would rise to 34pc in France, 38pc in Italy and an eye-watering 59pc in Spain.

The EU statistics agency said on Friday that jobless numbers across the eurozone hit a record 18m in July, .

An additional 88,000 people joined the ranks of the unemployed throughout July, although upwardly-revised June data meant that the unemployment rate was unchanged at 11.3pc, with Eurostat confirming that the 18m headline figure was the highest since records began in 1995.

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