The 17-nation Eurozone set another dubious record in the opening months of 2013, as its unemployment rate continued to climb from its already record-high rate. The jobless rate also rose for the European Union as a whole as austerity efforts continue to plague the continent’s recovery from the Great Recession:
The jobless rate reached 12 percent in both January and February, the highest since the creation of the euro in 1999, Eurostat, the statistical agency of the European Union, reported from Luxembourg.
The January jobless rate for the 17-nation currency union was revised upward from the previously reported 11.9 percent.
For the overall European Union, the February jobless rate rose to 10.9 percent from 10.8 percent in January, Eurostat said, with more than 26 million people without work across the 27-nation bloc.
Despite clear warnings that austerity isn’t boosting growth, some of the continent’s largest economies remain committed to deficit reduction. The United Kingdom, now on the precipice of its third recession in four years, has indicated that it will continue efforts to reduce the deficit, even as it has fallen far short of its past goals. The UK, in fact, has largely failed to put a dent in its deficit because austere policies have inhibited economic growth. Even Germany, the continent’s stalwart economy through the initial recovery, is lagging, and France announced last month that it would not seek to hit its deficit targets in 2013.
The United States took a different approach to recovery, boosting the economy with President Obama’s stimulus plan in 2009 and putting itself on a better path for growth than Europe has experienced. But it too has since embraced austerity. Government spending has traditionally boosted the economy out of downturns, but it has plateaued in recent years and has instead hamstrung the current recovery. Further budget cuts, such as the across-the-board sequester that went into effect March 1, could only make that worse.
Thus far, a rising housing market and strong retail sales provide evidence that the U.S. is still recovering, but manufacturing numbers slumped in March largely on concerns about how budget cuts would effect the economy. And while conservatives still claim that America’s “runaway spending” is harming the recovery, the truth is that the U.S. isn’t spending enough to give its economy the boost it needs to leave the Great Recession fully behind it.