Unemployment across the European Union is officially listed as ten million people, but new figures reveal the real total could be more than four times that amount.
Ten million unemployed Europeans constitute around four per cent of the the total labour force in the EU. The official unemployment figures paint a picture of low unemployment overall, though some individual states like Spain and Greece are quite the opposite.
However, a new study by the Bertelsmann Foundation seems to counter the official narrative, painting a much bleaker picture of the European economy. According to the foundation the true figures for long term unemployment could be as high as four times, or 16 per cent of the European labour force, Die Welt reports.
The study reveals that there is a hidden unemployment rate not covered by official statistics. Most EU countries, according to the study, mask the true unemployment rate with disability programs and generous early retirement pensions. Many who are long term unemployed simply stop reporting to the various labour offices and are therefore not counted among the unemployed.
The foundation researchers term these hidden unemployed as “long-term non-employed persons with labour market orientation,” in layman’s terms: people who would like to work, but simply can’t find a job. This large section of the population on disability benefits or early retirement schemes, coupled with the official unemployed and those who have given up trying to find work, together total a vastly larger number than the ten million official statistic.
Between the ages of 25-65, some 17 per cent of the population are unemployed according to the study. Several countries are affected much worse than others, like Greece, Poland and Croatia where up to a quarter of the working age population are without jobs. Italy and Spain are not much better with 20 per cent unemployed. Germany and Sweden are two of the very few to run counter to the trend with Sweden having an eight per cent rate and Germany with 12.
This long term unemployment can have severe negative effects not only for the economy but for the individuals who go without work or training. “By continuing unemployment there is a devaluation of human capital and educational investment, declining employment rates reduce labor market efficiency and growth potential of an economy,” the report says adding that long term unemployed can also be at risk for mental health issues and feelings of exclusion from society.
The migrant crisis may further intensify long term unemployed as many experts fear that the current wave of migrants will be a burden upon European welfare states for decades to come. Some even warn of a “lost generation” unable to work or contribute to the economy.
Adding to the hardship are so called ‘one euro an hour’ jobs where the German government heavily subsidies businesses who take on migrants and asylum seekers, furthering higher taxation for those in work and shrinking the market for jobs for those who do not.