Euro jobless rate climbs to 7.5 percent in August

[October 01, 2008]  BRUSSELS, Belgium (AP) -- The jobless rate in the 15 nations that share the euro climbed again in August to 7.5 percent as worries over European economic growth deepened, EU statistics agency said Wednesday.

The yearly rate was 7.4 percent in July, rising steadily from a record low of 7.1 percent in December 2007.

Euro-zone economic confidence is at its lowest level in seven years as consumers freeze spending, worried about job security and rising fuel and food prices. Companies are seeing lower exports and tight credit conditions from a global financial crisis.

Europe was slower than the United States to react to the credit meltdown that makes banks more reluctant to lend to each other and increases borrowing costs for home buyers and businesses seeking credit. The European economy contented to grow last year and in the first quarter.

But the euro-zone economy shrank in the three months ending June 30 and may continue to see growth contract -- with euro nations Germany and Spain forecast to slip into recession this year, along with non-euro member Britain.

Spain has now leapt ahead with the highest unemployment rate of all 27 European Union countries -- 11.3 percent -- as the economy slows sharply on the collapse of a housing bubble.

Germany, the largest euro and EU economy, is reporting 7.2 percent unemployment with France posting an 8 percent rate. The Netherlands has the lowest unemployment rate at 2.6 percent.

Some 11.6 million people in the euro area are now seeking work, the EU agency Eurostat says, part of the 16.5 million jobless across the entire EU.

[Associated Press]

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