Brussels, 19/05/2008 (Agence Europe) - During the fourth quarter of 2007, total employment increased by 3.3 million from a year earlier to reach 224.5 million, while unemployment had dropped to 16.1 million by the first quarter of 2008. However, quarterly employment growth halved in the last quarter of 2007 after the strong performance at the beginning of the year, and recent forecasts suggest that the unemployment rate may well bottom out in 2008. These are the main conclusions in a quarterly report on the EU spring 2008 labour market, presented on Monday 19 May in Brussels by the European Commission. In a press release the Commission indicates:
1) Year-on-year employment growth was still a solid 1.5% in the fourth quarter of 2007, but the quarterly rate declining from 0.4% in the previous quarters to 0.2% in the last quarter. The sustained employment growth was notably the result of strong performances by Germany (which reached the EU's employment rate target of 70% in the last quarter of 2007), Poland (now approaching the employment rate of Italy) and Spain. With the exception of Hungary and Lithuania, all Member States experienced continuing employment growth; in particular, Ireland, Latvia, Luxembourg, Malta and Slovenia, where it exceeded a year-on-year 3%. As a result, the overall EU employment rate came close to 66%, by the fourth quarter of 2007, up one percentage point from a year earlier;
2) the average EU unemployment rate recorded in the first quarter of 2008 reached 6.7%, down from 7.4% a year earlier. This resulted from continuing strong falls in the unemployment rate in Poland (down 2.7 percentage points on the year), but also in Germany and France. On the other hand, the labour market situation in Spain is showing signs of deteriorating, reflected by a rise in the unemployment rate (up by 1 percentage point on the year) to the second highest level in the EU after Slovakia;
3) Growth in hourly labour costs in the EU has picked up to an annual rate of 3.5% in nominal terms in the fourth quarter of 2007, a result of strong wage increases in the new Member States, only partly offset by modest wage growth in Germany;
4) financial turmoil, rising energy and commodity prices and falling consumer confidence may result in the macroeconomic outlook deteriorating further. The report can be consulted at: (http: //ec.europa.eu/employment_social/employment_analysis/quarterly_en.htm). (G.B.)