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Italy's record jobless rate raises pressure on Renzi

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Italy's record jobless rate raises pressure on Renzi
There were 272,000 more people looking for work in February than a year ago. Photo: AFP
08:18 CEST+02:00
Italy's unemployment hit 13 percent for the first time in February and is expected to remain high for months to come, raising the pressure on new Prime Minister Matteo Renzi.

The country's jobless rate continued to inch stubbornly up, defying improving economic conditions elsewhere in Europe and breaking January's record, Italy's national statistics agency said Tuesday.

While other eurozone countries hit hard by Europe's economic crisis - such as Portugal and Ireland - have seen a drop in the number of jobseekers, in Italy there were 272,000 more people looking for work in February than a year ago.

Only fellow eurozone trouble spots Greece and Spain have seen their jobless rates rise this year.

Renzi, on a trip to London Tuesday, described the figures as "distressing".

"In one year, a thousand workers a day have lost their jobs," he was quoted as saying by Italian media.

"There are signs of a recovery, but they are not enough."

Pietro Reichlin, an expert in macroeconomics at the Luiss University in Rome, said "the figures certainly are not good", though they came as no surprise.

"There is always a gap between economic recovery and the job sector following a crisis," he said, referring to the debt-laden country's two-year recession - the worst in the post-war period.

Italy's gross domestic product (GDP) grew by 0.1 percent in the fourth quarter of 2013, but ordinary Italians have yet to feel the benefits.

Renzi - Italy's youngest leader, who came to power six weeks ago - has promised to boost employment with a "jobs act" that would simplify the rules governing apprenticeships and lengthen flexible contracts to three years.

Reichlin said the laws, which he expects to come into effect within the next three months, should help to improve employment among the young, who are "the main victims" of Italy's economic crisis.

Unemployment among young people slipped slightly from its record high in January, but was still double where it stood at the start of 2008 at 42.3 percent.

That means more than one in 10 people aged 15 to 24 - 678,000 in total - was looking for work in February.

Paolo Mameli, economist at Italy's Intesa Sanpaolo bank, said he does not think the country's "embryonic" growth will translate into a drop in unemployment until later this year.

"In the best-case scenario, given that the very modest return to growth did not begin until the fourth quarter of 2013, we might see a small drop in unemployment during the second quarter of 2014," he said.

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