Saturday, May 18, 2013

''EU needs a swift and lasting unemployment cure'' by Victoria Dendrinou.

''LONDON, May 9 (Reuters Breakingviews) - Unemployment in the European Union has hit some unfortunate milestones. The rate is at a record high in the whole euro zone, as well as in such member countries as France, Spain, Portugal and Greece. It's easy, and fair, to blame the recession, but deep-seated labour market rigidities are culprits too.
The slow economy certainly hurts the job market, as companies with neither liquidity nor customers don't hire. The end of construction bubbles cuts out employment. But there's more than missing GDP behind the high unemployment rates in peripheral countries - on average about twice the rate for the euro zone.
Sticky labour markets are also responsible. Thanks to powerful trade unions, rigid hiring-and-firing laws and closed professions, it is often very difficult to employ new workers. Insiders, the already employed, have been treated favourably, leaving outsiders, often temporary contractors, vulnerable to job losses..''
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