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Jobs Crisis Grows As Greece Falters August 23, 2010

Posted by Yilan in Yunanistan.
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Greece’s deepening recession is driving joblessness steadily higher, feeding discontent with the government’s austerity program and dragging on the broader economy.

Greece’s gross domestic product contracted by 3.5% in the second quarter from a year earlier, hitting retailers hard and sending unemployment rates to above 12% of the work force, according to data released last week.

Forecasts vary on how bad unemployment could get. The International Monetary Fund predicts the jobless rate will reach 14.8% by 2012. But some labor experts fear that before long, one in five Greek workers could be without jobs.

A big worry is that the coming end of the tourist season, a major strut for the Greek economy, looms as the next threat to Greece’s struggle back to solvency and economic growth.

“We expect real unemployment to top one million workers by the year’s end, which is a rate of 20%. We warned the government early on that their policy mix was flawed and would lead to this,” said Stathis Anestis, spokesman of the private-sector umbrella union GSEE.

Unemployment, rising prices and an increasing tax burden could spell social unrest in the months ahead, Mr. Anestis said.

The job shortage underscores Greece’s difficult recovery from near-insolvency in May, with financial markets still fearing a relapse that could put new strains on the euro and government debt markets. In terms of divergence within the 16-country bloc, the gap between Greece and Germany, with its strong recovery, has never been wider.

The Greek government already has dealt with flare-ups of public anger this year, when it agreed to rigid fiscal cutbacks to qualify for a €110 billion (about $140 billion) bailout from the European Union and the IMF.

While there are no clear indications of more violence to come, public anxiety is palpable and consumers are holding back.

The job crisis is especially acute in northern Greece, where the Macedonia and Thrace regions see jobless rates of near 16%. After the tourist season draws to a close, the Ionian and Aegean islands are expected to match those levels.

Job losses are hitting all age groups, but people fresh out of school and young people in services-related or part-time jobs are the most vulnerable. One in three 15- to 24-year-olds who have left school and are in the labor force looking for work can’t find jobs, according to Greece’s Ellstat statistics agency.

Thanasis Alexopoulos has been relying on his parents for support since leaving university with a degree in German literature two years ago. The 24-year-old from Athens has spent a few stints waiting tables, but mostly has been sending out résumés without success.

“I am seriously thinking of leaving Greece, because we need a revolution in this country to have hopes for a better future,” he said.

Public-sector workers also are taking the brunt of job losses, as national and local governments pare back to meet stiff austerity targets.

George Kiolias, 39, was queued up outside an unemployment office after losing his job—at the unemployment office. Mr. Kiolias used to work at the Athens central headquarters of the Employment and Labor Agency until he was laid off seven months ago.

Against a backdrop of rising joblessness, Prime Minister George Papandreou has been meeting with top government officials to discuss how to ramp up tax collections. Tax intakes are €700 million below the seven-month targets, people within the government said.

In line with the prime minister’s drive, Greece’s financial-crimes office is targeting issuing up to €5 billion in fines by year’s end to clamp down on rampant tax evasion.

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