More than one-half of Greek youth unemployed

Country slashed minimum monthly wage by one-fifth to encourage hiring
By Harry Papachristou
||Last Updated: 03/08/2012

ATHENS (Reuters) — Greek unemployment hit another record high in December and for the first time the number of young people without a job outnumbered those in work.

Statistics service ELSTAT said that the overall jobless rate rose to 21 per cent from 20.9 per cent in November, twice the euro zone rate.

The average unemployment rate for 2011 jumped to 17.3 per cent from 12.5 per cent in the previous year, according to the figures, which are not adjusted for seasonal factors.

Youth were particularly hit. For the first time on record, more people between 15 to 24 were without a job than with one. Unemployment in that age group rose to 51.1 per cent, twice as high as three years ago.

Budget cuts imposed by the European Union and the International Monetary Fund as a condition for saving the debt-laden country from a chaotic default have caused a wave of corporate closures and bankruptcies.

Greece's economy is estimated to have shrunk by about one-fifth since 2008, when it plunged into its deepest and longest post-war recession. About 600,000 jobs, more than one in 10, have been destroyed in the process.

Things will get worse before they get better, according to analysts.

"Despite some emergency government measures to boost employment in early 2012, it is hard to see how the upward unemployment trend can be stabilized in the first half of the year," said Nikos Magginas, an economist at National Bank of Greece.

A record 1,033,507 people were without work in December, 41 per cent more than in the same month last year. The number in work dropped to a record low of 3,899,319, down 7.9 per cent year-on-year.

Pressured by its international backers under the terms of a planned European Union/International Monetary Fund bailout, the country's second since 2010, Greece last month slashed its minimum monthly wage by about one-fifth to about 580 euros ($763) gross, to encourage hiring.

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