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EU struggles with long-term unemployment

Janelle DumalaonJune 10, 2016

A newly-published study shows that more than half of the 22 million unemployed people in the European Union have been jobless for a year or longer, with older people and low-skilled workers the most affected.

Deutschland Wirtschaft Symbolbild Wachstum Konjunktur Eurozone
Image: picture-alliance/dpa/J. Büttner

The Bertelsmann Foundation, Germany’s largest non-profit foundation, published the findings of a study on Friday that showed the number of long-term unemployed people declining by 11 percent in the EU over the year between the third quarters of 2014 and 2015.

However, around 4.3 percent of all employable people in the EU have been looking for more than 12 months - and the concentration of long-term jobseekers varies widely across the union.

Mixed results across the EU

Especially in countries that experienced sovereign debt crises like Greece, Spain and Portugal, long-term unemployment affects the majority of jobseekers. In Greece, where around a quarter of the population is jobless, the long term unemployment rate stands at over 18 percent - a far cry from the 1.5 percent rate in the United Kingdom and Sweden.

Symbolbild Arbeitslose in Spanien
Image: picture-alliance/dpa

In Germany, although unemployment is at a record low of 4.7 percent, the study showed that long-term jobseekers made up more than 40 percent of all unemployed - meaning they profited little from the gains in Europe’s largest economy.

"Long-term unemployment has become a mass phenomenon threatening economic development in some countries," said Aart De Geus, chairman of the Bertelsmann Foundation. "Long-term unemployment doesn’t only affect state budgets, but also the people who remain far too long without any prospects and lose trust in politics and the market economy."

While people over 55 and those with low educational or professional skills are considered most vulnerable to falling into long-term unemployment, intermediate and high-skilled workers still struggle to find jobs reasonably quickly in economically struggling countries.

The study highlighted Lithuania and Slovakia as examples, where medium-skilled people made up 70 percent of the long-term unemployed.

Men more likely to be jobless for longer

Another finding of the study was that men were more at risk of being jobless for a longer period then women, as a result of male employment rates generally having been higher in the sectors most affected by recession, like construction and manufacturing.

The Bertelsmann Foundation called on policymakers to address long-term unemployment with a series of steps including training measures, and improving registration procedures for the unemployed in terms of profiling and early intervention.

"More than 22 million people in the EU would like to work, but are unable to enter the labor market, " said De Geus. "Policymakers should do more to activate this dormant potential."