Growing numbers of workers in the euro zone are unable to work as many hours as they would like, official figures showed Friday, casting new light on the grim outlook for consumers that could depress the region's growth prospects for some time to come.
The figures on underemployment--essentially where people take part-time work because jobs with longer hours aren't available--add to evidence of record joblessness and real-terms pay cuts even for those in work, as earnings growth has lagged the rate of inflation.
Those factors are likely to undermine consumer spending in coming months, depriving the currency bloc of an important source of growth at a time when weakness in the economy threatens to prolong a long- running fiscal crisis.
Eurostat, the European Union's official statistics agency, said that in the euro zone, some 6.15 million people were working part-time in 2012, but wanted, and were available, to work for longer hours.
That is up from 5.75 million in 2011, and 5.32 million in 2008, when Eurostat's records began.
That means a further 800,000 people were underemployed last year than in 2008, when the financial crisis pitched the global economy into recession.
Some of the steepest rises in underemployment were registered in countries at the heart of the euro zone's fiscal crisis, where government spending cuts and tax rises have contributed to falls in economic activity.
In Greece, the percentage of employees who were limited to part-time work against their wishes in 2012 had more than doubled compared with 2008, to 5.1% from 2.1%.
Spain's rate also doubled, to 8.0%, while Portugal's was up almost threefold to 5.6%. Ireland's rate of underemployment rose to 8.0% from 0.4%, a twentyfold increase.
However, in Germany, Europe's biggest economy and the one most resilient to the crisis to date, underemployment fell as a percentage of those in work, to 4.5% from 6.4%.
Germany's rate in 2008 was the highest of the 17 nations that now use the euro. Rising numbers of people working part-time against their wishes, alongside soaring unemployment and real-terms pay cuts, threatens to erode voter support for governments and lessen their resolve to pursue austerity measures aimed at cutting debts.
Voters' rejection of parties promising austerity in Italy led to hung elections in February, a political impasse that continued this week as lawmakers from the country's fractured parliament failed to decide on a new president.
Poor prospects for consumer spending, underpinned by sluggish wages and a growing prevalence of part-time work, makes it less likely the euro zone's economy will rebound later this year.
Growth would increase tax revenues for governments across the bloc, and reduce their welfare burdens, making it easier to cut public borrowing.
The International Monetary Fund this week downgraded its forecast for the currency bloc this year, predicting a fall in economic output of 0.3%. As recently as January it had expected output to decline by 0.1%.
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The figures on underemployment--essentially where people take part-time work because jobs with longer hours aren't available--add to evidence of record joblessness and real-terms pay cuts even for those in work, as earnings growth has lagged the rate of inflation.
Those factors are likely to undermine consumer spending in coming months, depriving the currency bloc of an important source of growth at a time when weakness in the economy threatens to prolong a long- running fiscal crisis.
Eurostat, the European Union's official statistics agency, said that in the euro zone, some 6.15 million people were working part-time in 2012, but wanted, and were available, to work for longer hours.
That is up from 5.75 million in 2011, and 5.32 million in 2008, when Eurostat's records began.
That means a further 800,000 people were underemployed last year than in 2008, when the financial crisis pitched the global economy into recession.
Some of the steepest rises in underemployment were registered in countries at the heart of the euro zone's fiscal crisis, where government spending cuts and tax rises have contributed to falls in economic activity.
In Greece, the percentage of employees who were limited to part-time work against their wishes in 2012 had more than doubled compared with 2008, to 5.1% from 2.1%.
Spain's rate also doubled, to 8.0%, while Portugal's was up almost threefold to 5.6%. Ireland's rate of underemployment rose to 8.0% from 0.4%, a twentyfold increase.
However, in Germany, Europe's biggest economy and the one most resilient to the crisis to date, underemployment fell as a percentage of those in work, to 4.5% from 6.4%.
Germany's rate in 2008 was the highest of the 17 nations that now use the euro. Rising numbers of people working part-time against their wishes, alongside soaring unemployment and real-terms pay cuts, threatens to erode voter support for governments and lessen their resolve to pursue austerity measures aimed at cutting debts.
Voters' rejection of parties promising austerity in Italy led to hung elections in February, a political impasse that continued this week as lawmakers from the country's fractured parliament failed to decide on a new president.
Poor prospects for consumer spending, underpinned by sluggish wages and a growing prevalence of part-time work, makes it less likely the euro zone's economy will rebound later this year.
Growth would increase tax revenues for governments across the bloc, and reduce their welfare burdens, making it easier to cut public borrowing.
The International Monetary Fund this week downgraded its forecast for the currency bloc this year, predicting a fall in economic output of 0.3%. As recently as January it had expected output to decline by 0.1%.
nasdaq.com
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