Eurozone Jobless Rate Falls Below 10%

The eurozone’s unemployment rate has fallen below 10% for the first time since 2011. Unemployment fell to 9.8% in October—its lowest rate for seven years—from a revised 9.9% in September, the EU statistics agency Eurostat reported.

Eurostat had originally estimated the September rate at 10%, BBC reported. 

Germany’s jobless rate was 4.1% while Portugal’s was 10.8%. Nearly 16 million people in the 19-nation bloc are seeking work Eurostat said, down 178,000 on September and some 1.12 million lower than a year earlier.

The European Central Bank has been taking continued action to stimulate the bloc’s economy. In March this year, the ECB stepped up its efforts, cutting its main interest rate from 0.05% to 0% and its bank deposit rate from minus 0.3% to minus 0.4%.

It has also stepped up its program of quantitative easing, and is now buying €80 billion ($85.18 billion) worth of bonds a month.

The bank is currently worried about political uncertainty within the eurozone, with a constitutional referendum in Italy on December 4 and elections in France and Germany next year.

Across the eurozone, the rate of unemployment has gradually fallen since a peak of 12.1% in early 2013. But it remains much higher than the rate seen before the global financial downturn. In March 2008, the jobless rate was 7.2%.

And youth unemployment remains high, at 20.7% in the eurozone area, although down from the 22.2% figure of a year earlier.

Of the 17 nations to report figures for October, 14 saw their jobless rate fall, in Cyprus and Lithuania it was unchanged and the rate rose slightly in Malta. There was no fresh data from Greece or Estonia.

For the EU as a whole, the unemployment rate was 8.3%, down from 8.4% in September and the lowest rate since February 2009.

In Greece and Spain, the unemployment rates—while also falling—remain high at 23.4% and 19.2% respectively.

Unemployment for people under 25 remains more than double the overall rate, with one in five of those seeking work unable to find it across the eurozone. Youth unemployment remains at more than 40% in Greece and Spain and stood at 36.4% in Italy, Eurostat said.

The size of the region’s economy only surpassed its pre-crisis peak this year—much later than the US and Britain.

“Improving labor markets are key if eurozone consumers are to make a solid contribution to growth over the coming months, especially as gradually rising inflation is likely to eat into purchasing power,” said Howard Archer, economist at IHS Markit, a consultancy.