RSS
  • Economics    April 10 
Greece's Great Depression isn't abating

In Greece, over a quarter of the workforce is still looking for a job but can't find one:

[ELSTAT]

This is much worse for young Greeks. The unemployment rates among 15- to 24-year-olds and 25- to 34-year-olds are at 56.8 percent and 35.5 percent, respectively.

When countries have a recession with high unemployment, governments generally have the opportunity to enact stimulus spending to use up slack in the economy, reduce the unemployment rate, and give the private sector a chance to recover. This is what the United States did following the 2008 financial crisis, resulting in an unemployment rate today of 6.7 percent — still quite high, but nothing like Greece. However, with Greece having given up its monetary sovereignty to the European Central Bank, Greece's borrowing costs spiked, as markets worried Greece would run out of money. This meant that Greece's government was forced into harsh spending cuts just as the private sector was weakening and unemployment was rising.

With the economy in the toilet, and jobs impossible to come by, hundreds of thousands of Greeks are leaving. As BBC noted last year, "A recent study by the University of Thessaloniki found that more than 120,000 professionals, including doctors, engineers, and scientists, have left Greece since the start of the crisis in 2010."

But not enough people have left to make a substantial impact on the unemployment rate. The eurozone, unlike the United States, doesn't have a common language. People in Germany predominantly speak German, people in Greece predominantly speak Greek, people in France predominantly speak French. This means that mobility between states with low unemployment like Germany and high unemployment like Greece is much lower than in the United States:

[European Commission]

So for Greece — and other eurozone countries suffering from massive unemployment like Spain, Italy, and Portugal — the long, slow, painful crisis continues, and will continue into the foreseeable future. --John Aziz

Editor's note: This article has been revised since it was first published in order to more clearly include proper attribution to source material.

 
 
Load More Articles

THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER

Most Popular Speed Reads
FOLLOW SPEED READS

About Speed Reads
Speed Reads is TheWeek.com's continuously updated collection of the most interesting, important, and trending things on the internet – delivered with concision, intelligence, and wit. Contact us at speedreads@theweek.com.
Subscribe to the Week