Europe, in the Claws of Unemployment

Yasin Yagcı - Holland
The European Union, which has not had the influence desired in the international arena, especially when compared to the number of its member states and its potential, is trying to find a way out from its current economic crisis.
The decrease in consumption and growth due to the regression in employment is the major factor in this problem. Consumption decreases when employment decreases, and the economy comes to a standstill. Besides the economic values, the growth of the unemployment problem is an indicator of another danger. Until recently, in Europe unemployment meant losing a job. But today unemployment comes with the danger of hunger in addition to losing a job. The unemployment problem forces governments to carry out radical changes.

Although some countries have shown improvement in their economies, the unemployment problem has become the EU’s nightmare. According to the statistics, there are currently about 480,000 unemployed. This number was about 470,000 last year.

Things are not different for Germany, the engine of Europe. For the first time since the1930s, the number of unemployed has exceeded 5 million people. According to official German announcements, the total number of unemployed is 5 million 37 thousand. Other countries have similar numbers. According to recent statistics from Eurobarometer, the Statistics Office of European Union, one of every four Europeans is unemployed.

When quoting unemployment numbers, we also have to consider that this problem does not affect everybody the same way. According to both statistics and the reality, the most affected are the middle and low-income groups. The lower-income group with a low education level, which makes up the biggest portion of unemployed, is struggling to survive. We also have to remember that this low-income group is mostly made up of foreigners. 

Besides the common people on the street, the employment problem also affects the public budget. The increase in the number of people getting unemployment subsidies means bigger deficits in public budgets.

In three or four years in many European countries a new savings package declared. This in turn brings down the people’s purchasing power. Naturally, decreasing purchasing power means decreasing consumer spending. Increasing unemployment insurance payments and decreasing consumption affects the public budget and at the same time limits growth.

Expecting some short-term results from these tough savings programs in European countries such as Germany, Holland and other EU member countries is like having a dream. There are some positive movements in growth numbers, but we also remember that the amount of unemployment is also growing. The effects of a growth strategy, which cannot control this deficit, is open for discussion.  

(July 2005, 17th Issue)
Last modified onSaturday, 06 May 2017 10:07