Record unemployment with nearly half of EU’s jobless out of work for over a year

Christian Odendahl, chief economist at the Centre for European Reform, said the rise in long-term unemployment, was, in part, down to the length of the recession in parts of southern Europe.

He added: “The big danger of this long-term unemployment is that it is likely to turn into persistent, structural unemployment as the recovery in the eurozone in particular will be slow. This lowers growth in the medium term.

“One of the key mistakes was not to support economic demand sufficiently: fiscal policy got tightened in the midst of the recession while the European Central Bank was reluctant to pursue monetary stimulus with the necessary boldness and is now getting 0.5 percent inflation in return.

“The long-term unemployment is one reason why fiscal consolidation efforts in the eurozone might be self-defeating: the deficit reduction that you get in the short run will be compensated by lower growth/higher unemployment in the future, and hence larger deficits.”