Are Greek Unemployment Figures a Sign of an Economic Turnaround?


Greek unemployment data from the second quarter of this year gives some cause for optimism about the country’s economy, Reuters reports. The unemployment rate in the second quarter was 27.1 percent during the second quarter of this year, down from 27.4 percent in the first quarter this year. This represents the first time that unemployment rates have moved in a positive direction in Greece in quite a long time.

However, the quarterly rate is calculated differently than the month by month rate, which last week was announced to have jumped from 27.6 percent to 27.9 percent in the month of June (as opposed to May). So, while the overall jobless rate in the quarter may have declined from earlier this year, the immediate data does little to suggest that the latest statistic being championed by the Greek government places any weight on the theory of an economic recovery for the beleaguered Mediterranean country.

Yannis Stournaras, the Greek finance minister, did mention the data as a positive sign. He also pointed to decreased projections in economic contraction and to employment levels in hotels and restaurants, which jumped 11 percent from the previous quarter. However, this may simply be due to seasonal variance and a rebound in the tourism industry that has been fueled by an influx of tourists from eastern Europe. While it is better to see a rise in the tourism industry than a decline, many worry about the amount of money that tourists from eastern European countries can bring into Greece, and whether activity in the industry is really indicative of an economic rebound.

This week was filled with other bad news for Greece. A strike among teachers and doctors brought many areas of the public sector to a minimal capacity. The workers are on an austerity strike, meaning that they are opposed to the job cuts that are being forced upon the Greek government as part of bailout deals from international organizations. Over 15,000 jobs in the public sector are slated to get the axe in the near future, with many more being forced to switch jobs or take pay cuts.

In addition, data about Greek birth rates showed that births have declined by 15 percent over the last four years. Some analysts have speculated that the economic conditions have driven the drop as women not only do not feel as if they have the financial security to raise a child or to start a family, but, in some cases, they cannot even afford their hospital bills. Reports have surfaced of mothers escaping from hospitals after giving birth with their babies because they can’t afford the maternity charges.

In light of all the statistics, it would seem premature to declare an economic recovery in Greece. The country is expected to require an additional 10 or 11 billion euros in funding before the end of 2014. Worst of all, youth unemployment levels in the nation remain well above 50 percent. However, the unemployment statistic released today at least serves as a bright spot on an otherwise dark background.

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