European Unemployment Reaches Record 11.3 Percent

European unemployment has reached a record 11.3 percent, with 18 million people in 17 countries still looking for a job. The unemployment rate for the Euro-using countries remained at a record high level from July to August, with official figures on Friday highlighting the massive task leaders face to restore confidence in Europe’s economy.

Eurostat showed that 88,000 more people were without a job in July, while both governments and companies continue to lay off workers in an attempt to deal with high debt and weak consumer spending, reports The Washington Post.

The unemployment rate of 11.3 percent is up 1.2 points from one year ago, and is also the highest level since the euro’s formation in 1999. Joblessness rates in Spain and the recently bailed-out Greece increased. Both countries are currently at the center of the European sovereign debt crisis, which has brought doubts into the future of the Euro currency.

Spain’s jobless rate rose to 25.1 percent, the highest in the Eurozone’s 17 countries. Greece’s latest data from May shows the bailed-out country at 23.1 percent unemployment, compared with 16.8 percent just one year before. For youths, the employment rate was even worse in Spain, with an astonishing figure of 52.9 percent for those under25, whereas Greece’s was 53.8 percent.

EU Employment Commissioner Laszlo Andor cautioned that there is no quick fix for the unemployment rate, but said that:

“Partners at all levels need to do all they can to avoid a lost generation which will be an economic and social disaster.”

Bloomberg Business Week notes that Don Smith, a London-based economist at ICAP Plc spoke with Bloomberg Radio’s Ken Prewitt yesterday, saying:

“The whole euro zone is undergoing negative growth developments. The sense is that increasingly the euro-zone crisis is bearing down on countries in northern Europe and Germany in particular and this is really forcing officials’ hands toward coming up with a firm solution.”

The Euro was still higher against the dollar, trading at $1.2587 at 12:54 pm in Brussels, but the European currency has declined over 12 percent in the last year, while EU leaders battle the debt turmoil that has already prompted five Euro-area countries to ask for external aid.