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05european labour market outlook home EU Employment Restructuring Report Q4 2012

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01 EU Labour
market trends
02 EU member
state labour
03 most heavily
impacted sectors
04 reasons
for announced
job losses
05 european
labour market
06 major
job layoffs
in europe
07 major
job creations
in europe
about this
➔ Europe’s economy
is in for further difficult
days, with all the forecasts
pointing to ongoing weak
activity and nervousness
surrounding official efforts
to rein in government debt
and curtail spending.
In a pattern that is becoming
familiar, the immediate
crisis facing Greece has
been averted, with an
agreement to reduce the
country’s debt by 40 billion
and soften its medium term
debt-to-GDP targets.
So another crisis is averted,
which, depending on your
view, either avoids catastrophe
or forestalls the inevitable.
There are many uncertainties
and too few positives
hovering over the EU to
13 | Employment RestructurinG report | European union edition Q4 2012
have anything other than
a downbeat outlook.
Glimmers of optimism, such
as a more positive tone
in the UK economy, are
overshadowed by the weak
consumer and business
confidence elsewhere.
The European Economic
Sentiment Indicator
has reached a new low,
while the eurozone
Purchasing Managers’
Index has worsened.
The labour market, as
a lagging indicator, will
continue to feel the pain from
weak business sentiment,
low levels of investment,
and worried consumers.
Even if, as the OECD and
IMF suggest, the EU economy
begins to respond by
mid-2013, it will be well into
2013 before the labour market
starts to show signs of life.
On the positive side, there are
more hopeful signs emerging
from the US economy, where
business activity and the
housing market are seeing
definite signs of recovery.
Even the political stage show
surrounding the so-called
fiscal cliff seems likely to avoid
an economic meltdown.
In China, the key indicator
of factory output has
registered its first uptick in
the last year, suggesting
that the contraction there
may be nearing an end.
The OECD makes a very clear
point about the EU outlook
– some decisive action has
already been taken but much
more will be needed to stem
deep-rooted imbalances
in a number of countries.
The question remains whether
the most troubled economies
have the political or social
will to manage a monumental
turnaround in productive
capability and lifestyle. Equally,
will the central bankers
and the better-performing
economies be able to endure
this prolonged re-balancing?
For the moment, there is
little to cheer. The best that
can be expected is that
the EU will lurch from one
economic or banking hurdle
to the next, and that global
recovery will help to push
it toward a more stable
recovery some time in 2013.

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