Unemployment rate falls to 8.5% in the third quarter of 2017

The unemployment rate fell to 8.5% in the third quarter of this year.  The number was disclosed this Wednesday by Statistics Portugal (INE) and it confirms the upward trend in the labor market that has been registered since 2013. One would have to go back to the end of 2008 to find a smaller percentage.

In comparison to the previous quarter, the unemployment rate retrieved 0.3 percentage points. When compared with the same quarter of the previous year, the plunge is even more expressive. By then, the unemployment rate was still above double digits, at 10.5%.

As explained by INE, the decrease in unemployment happened while the labor force increased, currently standing at 5.2 million people. In comparison to the previous quarter, this number represents a 0.5% increase, and in comparison to the homologous quarter, it’s a 0.7% increase.

Additionally, there was a positive net flow into employment and a decrease in the number of unemployed. In just one year, the economy created 141.5 thousand more jobs, “continuing the positive year-on-year changes observed since in the 4th quarter of 2013”, according to INE.

The number of unemployed decreased to 444 thousand, 105.5 thousand people less than in the same period of 2016.

Youth unemployment rate must be carefully considered, since it is normal that it suffers an increase in the third quarter due to the end of the school year and the entrance in the labor market. For this reason, it is more important to analyse the rate’s homologous behavior: there was a decrease from the 26.1% rate between July and September of 2016 to 24.2% in 2017.

The same goes for the analysis of young people aged 15 to 34: according to INE, “11.8% were not in employment, education or training. This rate has increased by 1.0 p.p. from the previous quarter and decreased by 1.5 p.p. from the same quarter of 2016″.