Greece’s Youth Unemployment Hits 60%

Greek youth unemployment rose above 60 per cent for the first time in February, reflecting the pain caused by the country’s crippling recession after years of austerity under its international bailout.

Greece’s jobless rate has almost tripled since the country’s debt crisis emerged in 2009 and was more than twice the euro zone’s average unemployment reading of 12.1 percent in March.

While the overall unemployment rate rose to 27 per cent, according to statistics service data released on Thursday, joblessness among those aged between 15 and 24 jumped to 64.2 percent in February from 59.3 percent in January.

Youth unemployment was 54.1 per cent in March 2012

‘It is by far the highest youth unemployment rate in the euro zone, highlighting the difficulties young people face in entering the labour market despite government incentives to create jobs,” said economist Nikos Magginas at National Bank.

Athens has lowered the minimum monthly wage for those under 25 years by 32 per cent to about 500 euros to entice hiring.

Greece’s economy is in its sixth year of recession, battered by tax hikes and spending cuts demanded by its European Union and International Monetary Fund lenders.

The economy is expected to slump by 4.2 to 4.5 percent this year.

Earlier this week Greece was ordered by the International Monetary Fund to do more to crack down on its ‘notorious’ tax evasion problem.

After completing its latest health check, the IMF concluded that Greece had made progress slashing debts and improving competitiveness.

But it said ‘very little progress’ had been made in tackling tax evasion.

It added: ‘The rich are not paying their fair share which has forced an excessive reliance on expenditure cuts and higher taxes on those earning a salary or a pension.’

Endemic tax evasion in Greece was a major factor in the collapse of its economy. But it is also making it harder for Greece to shore up its finances.

In a clear sign that patience is running out, the IMF said ‘decisive correction actions’ were needed, including a ‘deeper political commitment to tax administration reform’.

The IMF also said Greece must take more radical action to trim down its bloated public sector.

It has already agreed to cut 150,000 public sector jobs by 2015.

The IMF said Greece had made ‘exceptional progress’ on reducing its budget deficit, one of the key conditions of its £202bn bail-out.

But it said the country’s public debt remains much too high.