Home > Uncategorized > Some recent data on the EU

Some recent data on the EU

Summary: the Eurozone does even worse than surrounding EU countries.

1) Growth. Quarter on quarter growth is low or even negative, especially in the Eurozone (graph). Remarkably is that austerity darlings Estonia and Ireland, both austerity darlings, both witnessed considerable contraction. The highest growth in the Atlantic Area was by the way realized by tiny Iceland (+3,6% quarter on quarter). Fun fact: growth in tiny Iceland (not in the graph) is by far the highest of the entire Atlantic region. Remarkably: the Euro countries are doing significantly worse (try a Wilcoxon test).

1. Quarter on quarter growth of EU countries, 2013-Q1 (third estimate)

1a1

Source graph: Eurostat, text added

2) Unemployment. Average unemployment as well as differences between Germany and almost all the other countries are still increasing. There has however been a considerable downward revision (0,2%), especially because of a rather large downward revision of the data for France which looks a little less bad because of this. When we look at last year it turns out that by far the larger part of the increase of European Union unemployment was located in the Euro countries.

2. Unemployment in the Eurozone, the EU, the USA and Japan

1a2

Source graph: Eurostat, text added.

P.S. – no European economist is allowed anymore to talk about a Japanese lost decade.

3) Retail sales. Oops.

aaretailsales

Source data: Eurostat.

4) Germany: real monthly wages are slightly declining (yes, declining). Real hourly wages are slightly increasing but the number of hours worked per month as well as the ‘variable’ elements of monthly wages declined. Which means that the ongoing decrease of German unemployment and the increase of employment (at a very moderate rate of not even 1% a year) is not caused by a vigorous expansion of production but by Germans working even less hours. The good thing about this is that you need less growth to keep employment up. Looking at details it is surprising that wages of people with limited education (“Fachkräfte – ungelehrte Arbeitnehmer”) and people with microjobs (geringfügig Beschäftigte) rise fastest (for the first time in many years), those of the last category (which after 2007 had seen the lowest wage increase of all groups of ‘Arbeitnehmer’) even with 5,1%.

  1. July 5, 2013 at 12:56 pm

    Unlike the United States or Japan, Europe used different prescription , as some countries trying to resort devaluation currency and the desire to restore their competitiveness by reducing the levels of wages and prices, which reduces the rate of inflation, But it is clear that such policies doesn’t help indebted countries in Europe, but on the contrary, we have seen how these policies have led to the complexity of their positions , so currently there are more resound which demands ending the European austerity policies and follow expansionary policies that raise the rate of inflation.!!

  2. July 9, 2013 at 3:56 pm

    The euro area is simply a mess. Rather than coordinate a rational policy, each country instead seeks to obtain a preferential policy based on its (perceived) national interest. Because net-lending countries, especially Germany, have an upper hand vis a vis debtors, policy prescriptions tend to reflect their narrow, short-term interests.

    Until the issue of bank insolvency in the euro area – both in the south and the north – is tackled head on, there will be little economic improvement. As repugnant as bailing out a predatory financial sector is, the alternative is apparently much worse. Here’s some analysis of financial leverage in the euro area: http://wnywj.wordpress.com/2013/05/18/in-just-one-word-why-germany-refuses-to-end-the-crisis-in-the-euro-area-leverage/ .

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