Portuguese unemployment rate hits new low, standing now at 7%
Unemployment rate plunges in May, reaching 7% albeit INE's prior estimations. A drop in youth unemployment will be behind the estimated fall in unemployment for June.
The unemployment rate in Portugal reached its lowest rate since October 2002, accordingly to the data released this Monday. Standing now at 7%, the Portuguese statistics institute also estimated that the unemployment rate will continue decreasing.
The data released contradicts INE’s prior estimations, that anticipated the rate to reach 7,3%, which would have represented the first increase in unemployment over nine consecutive months.
The economic situation of the country, however, improved, and as such, a 0,1 percentage point fall was registered in relation to April’s records. It has decreased by 2,2 percentage points, in comparison with May 2017, whilst only in 2002, we find such low rates in terms of unemployment.
The country’s performance in terms of unemployment has been improving significantly over the last four months.
Unemployment, June 2017 – July 2018
There were 362.8 thousand people unemployed in May, which represents a 14% fall in comparison to April. The active population stood at 4.791 million people which reflected an increase in comparison to the previous month of April.
For June, INE estimates that the jobless rate should fall yet again, reaching 6,7%, which translates into a decrease of unemployed people (347.1 thousand) and an addition of 13,200 people towards the active population basket (4.805 million).
The decrease in the unemployment rate is mostly verified because of the fall of unemployed people amongst the 25-74 age group (in which the unemployment rate fell by 6,1% to 6% in May). In June, however, the main driver for the fall of the jobless rate will be youth unemployment, which is due to decrease significantly, reaching 19,6% that month.
Accordingly to the OECD data, in 2017, Portugal’s youth unemployment rate reached 23,9%, having been surpassed only by Italy (34,8%), Spain (38,7%), Greece (43,6%) and South Africa (53,4%). The average of young people between 15-24 years old, who reported they were without work in the OECD countries in 2017 was 11,9%, whilst the Euro area registered an 18,8% average.
