Greece’s economy is the 51st largest in the world and the 7th largest in the European Union. The economy is based on the service and industrial sectors, with agriculture contributing less than 5% of the national economic output. After about a decade of sustained economic growth, Greece went into recession in 2008. In the years following, the country’s economy faced the highest debt deficit in the EU. The debt deficit and increased borrowing shut Greece out of the global financial market, leading to a severe economic crisis. Greek’s economy continues to face several problems including high unemployment rate, tax evasion, low global competitiveness, corruption, and inefficiencies in the public sector.
As a result of the economic crisis in Greece, the country’s industrial production fell significantly. The volumes of building activities and retail sales also declined by wide margins. Before the onset of the economic crisis in 2008, the Greek unemployment rate was a record low at only 7.2%. However, between late 2008 and June 2013, unemployment skyrocketed to 27.9%, resulting in a massive loss of jobs. Youth unemployment hit 64.9% by May 2013. Despite the challenges faced by the country, the unemployment levels have steadily improved after peaking in 2013.
In November 2019, the unemployment rate fell to 16.5%, a 0.05% fall from the previous month, and compared to 18.6% in the same month of the previous year. November’s rate is the lowest unemployment rate since 2011. According to Greek Statistical Authority, which updates the rates monthly, the number of unemployed individuals fell by 8,701 from 781,315 in October 2019 to 772,614 in November 2019 (representing a 1.1% decline) and down by 104,254 from the same month in 2018. The number of employed individuals fell by 0.2% from October 2019 but grew by 2% compared to November 2018.
Youths between the ages of 15 and 24 are the most affected by the unemployment problem in the country. Youth unemployment was 39.7% in November 2019 compared to 36.1% in November 2018. The unemployment rate among women was 20% in November while it fell to 13.7% among males. Different unemployment rates were also recorded in different regions. The highest unemployment rate was reported in Epirus-West Macedonia (19.7%) while Crete registered the lowest rate at 12.7%. Although the Greek authorities have tried to reduce the unemployment levels, they still have a lot to do to reduce the unemployment rate to pre-2008 levels.
High Debt Levels To Blame For High Unemployment
One of the primary causes of unemployment in Greece is the national debt. In 2011, Greece was granted a bailout packed of €109 billion by its European counterparts to manage the ballooning debt levels. Along with the loan, Greece was given a credit rating with a disclaimer that the country was at high risk of default. This credit rating pushed away investors and potential ones from investing in the Greek economy. The lack of investment in the country, combined with the effects of government austerity programs, greatly impacted the growth potential of the economy of Greece. The result was the loss of millions of jobs.
The unemployment rate in Greece fell to 16.5% in November 2019, the lowest in the country since April 2011. The number of unemployed individuals was down by about 104,000 in November 2018. Unemployment remains highest among the youths at 39.7%. The rising national debt is to blame for the high unemployment rate.