Unemployment set to soar in Portugal in coming months.jpg

Unemployment set to soar in Portugal in coming months

By CHRIS GRAEME [email protected]

Portugal could be hit with unemployment figures as high as 650,000 according to a report by the Organisation for Economic Cooperation and Development (OECD).

Although the Portuguese economy technically began recovering from the recession in the second quarter of 2009, the OECD has warned that the worse, in terms of jobless figures, was still to come.

In its annual report into the Portuguese market, the OECD predicts that unemployment will rise by 11.7 per cent by the end of 2010, with the number of out of work reaching 650,000 from a working population of just over five million.

According to OECD estimates, which see the end of 2007 as the beginning of the labour crisis, unemployment worsened by 1.5 percentage points by the end of the second quarter of the year, with an extra 84,000 unemployed by the end of August 2009.

The picture painted by the OECD will be substantially bleaker in the coming 18 months with the unemployment rate rising by a further 2.3 percentage points, adding a further 126,000 jobless onto the dole queue.

Although the economy is beginning to leave negative growth figures, conditions in the employment market are likely to get worse before they get better because the effects of the 2007 and 2008 economic slowdown take time to trickle down to individual companies.

The situation is the same for most of the other OECD countries with the United States leading the unemployment figures with six million jobless, the United Kingdom with 2.5 million out of work and Spain with 4.4 million unemployed, up 153.1 per cent, with nearly 20 per cent of the population on the dole in some areas.

Overall unemployment levels for the Eurozone are expected to hit 25 million by 2010 while between 2007 and 2010 the jobless figures could have risen by 80.1 per cent and by 47.9 per cent in Portugal.

The reason why Portugal is likely to keep its jobless figures down compared with other European neighbours is because she, like Poland, has invested the most in policies aimed at job creation.

Even so, the measures adopted by the government to fight the crisis could have secured the creation of 28,000 jobs between the beginning of this year and the end of next – a number which will not be sufficient to counteract Portugal’s soaring unemployment rate for the period.

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