SPOTLIGHT ON THE INTERNATIONAL
AND ITALIAN ECONOMY
The most worrying fact, that best summarises the disastrous effects of the international economic crisis on the Italian labour market, is the growth in unemployment: between 2008 and 2009 the number of people seeking a job in Italy rose from around 1,692,000 to 1,945,000, with an average annual growth of 15.0%. The roughly 253,000 more jobless was compounded by the 380,000 fewer people in employment, approximately 23,025,000 in 2009. Only in part, however, have the effects of the serious economic crisis been reflected in a fall in those in employment; the massive recourse by companies to Cassa integrazione guadagni (lay-off relief payment schemes) has, in fact, mitigated the direct consequences of the negative situation on employment as a whole. Broadening considerations to the overall supply of employment, the Istat figures reveal for 2009 a decrease of 0.5% of the workforce, approximately 127,000 less than 2008.
After the growing trend that started in 2005, in the first quarter of 2009 employment in Italy began to fall. In 2009, around 380,000 jobs disappeared compared to the previous year, for an average annual variation of -1.6%. This dynamic led to a decrease in the employment rate of the population aged between 15 and 64 to 57.5%, from 58.7% in 2008.
At the geographical level, the Mezzogiorno suffered the most substantial loss of employment, while the central regions of Italy were the ones least exposed to the impact of the negative situation. The consequences of the crisis affected male employment (-2.0%) more than female employment (-1.1%). This fall can be traced back particularly to industry (-3.4%), while the services sector suffered a more contained fall. The crisis had a particularly intense effect for younger workers, for those who had only finished middle school, or who had a degree. Selfemployed workers saw a higher decrease than employees.
After the growing trend that started in 2005, in the first quarter of 2009 employment in Italy began to fall. In 2009, around 380,000 jobs disappeared compared to the previous year, for an average annual variation of -1.6%. This dynamic led to a decrease in the employment rate of the population aged between 15 and 64 to 57.5%, from 58.7% in 2008.
At the geographical level, the Mezzogiorno suffered the most substantial loss of employment, while the central regions of Italy were the ones least exposed to the impact of the negative situation. The consequences of the crisis affected male employment (-2.0%) more than female employment (-1.1%). This fall can be traced back particularly to industry (-3.4%), while the services sector suffered a more contained fall. The crisis had a particularly intense effect for younger workers, for those who had only finished middle school, or who had a degree. Selfemployed workers saw a higher decrease than employees.
UNEMPLOYMENT RATE IN ITALY 2004-2010
Source: Unioncamere Piemonte on Istat figures
The impact of the unfavourable situation has not spared even the foreign component of the Italian labour market: in 2009 the number of foreign workers increased by about 147,000, fully reflecting the increase in the population of foreign nationality resident in Italy. Instead the employment rate of foreign workers underwent between 2008 and 2009 a sharper fall compared to that recorded by the Italian labour market as a whole.
The fall in the demand for labour is associated with a strong growth in the number of people seeking employment. Again on this front, it was the male component that met the greatest difficulties, with an increase of almost 22%, against a growth of unemployed women of 8.4%. The analysis by age and education shows how the effects of the crisis have had the greatest impact on young high school leavers and graduates looking for jobs. Also more penalised were the unemployed with previous work experience compared to those looking for their first job; there was, instead, lower growth than the overall figure for long-term unemployment (+12.2%), a trend that could be linked, in some cases, with the definitive exit from the labour market of people who had been seeking a job for more than 12 months. These dynamics have led to a notable increase in the unemployment rate, rising from 6.7% in 2008 to 7.8% in 2009. However violent, the impact of the international crisis on the Italian labour market seems to have been less devastating that in other European countries: on the basis of the OECD data, in the area as a whole the unemployment rate grew from the 6.1% of 2008 to 8.3% in 2009. With the exception of countries like Germany and the Netherlands, where lower increases in unemployment rates have been recorded, the other nations have shown more substantial increases: in France, the share of people looking for employment out of the total workforce has risen from 7.8% to 9.5%, in the United Kingdom from 5.6% to 7.6%, in the United States from 5.8% to 9.3%. In the European Union as a whole, the rate has risen to 8.9%, from 7% in 2008, while the consequences of the negative situation are even more evident if looking only at the Eurozone, where the rate leapt to 9.4% from 7.6% a year earlier. The fact that Italy held up better is due essentially to the possibility, absent elsewhere, to turn to the lay-off pay relief scheme: in 2009, the number of hours authorised amounted in fact to almost 915 million, 301.7% more than the previous year, evidence of the massive recourse to social safety nets made by the Italian companies hit by the crisis.
The dynamic of Piemonte's labour market does not differ particularly from the situation found at the national level. People in employment in Piemonte fell by about 25,000, 1.3% less compared to 2008; in contrast to what happened in Italy as a whole, in Piemonte the female component has turned out to be weaker than the male part, with a negative variation of 1.6%, against -1.1% recorded for male workers.
The overall dynamic is the result of net fall in those employed in industry, only in part compensated by an increase in agriculture and construction. As an overall effect, the employment rate of the population aged between 15 and 64 dropped more than one per cent, from 65.2% to 64%. The rate also stayed the same in 2009, higher than the national average, but lower than the average of the north-western regions (65.1%).
Again in Piemonte, the crisis had particularly serious effects for younger workers. The fall in employment has been, in addition, heavier than the annual average for both workers who had only finished middle school and those with at least a degree. Finally, the contraction in the demand for labour has been tighter for workers with temporary contracts.
The fall in demand for labour is also associated in Piemonte with a growth in the number of people seeking employment (+36.1%); the unemployment rate thus rose from 5% to 6.8%.
Shifting attention to the beginning of 2010, the weak signs of recovery glimpsed on the international and national economic scenarios from the strictly production point of view are not matched by positive indications for the labour market. All the main international research institutes agree that, even in the event of a partial recovery of other indicators, those regarding the labour market will continue to worsen at least until the second half of 2010. On the basis of the latest indications given by the OECD, in April the unemployment rate for the area was 8.7%, stable compared to March 2010, but 0.6% more than in April 2009. In Italy, the value of the indicator rose in the same month to 8.9%, 1.5% more than in April 2009, while in Piemonte, in the first quarter of the year, the percentage of the unemployed out of the whole workforce reached the record level 8.0% (7.0% in the first quarter of 2009).
The impact of the unfavourable situation has not spared even the foreign component of the Italian labour market: in 2009 the number of foreign workers increased by about 147,000, fully reflecting the increase in the population of foreign nationality resident in Italy. Instead the employment rate of foreign workers underwent between 2008 and 2009 a sharper fall compared to that recorded by the Italian labour market as a whole.
The fall in the demand for labour is associated with a strong growth in the number of people seeking employment. Again on this front, it was the male component that met the greatest difficulties, with an increase of almost 22%, against a growth of unemployed women of 8.4%. The analysis by age and education shows how the effects of the crisis have had the greatest impact on young high school leavers and graduates looking for jobs. Also more penalised were the unemployed with previous work experience compared to those looking for their first job; there was, instead, lower growth than the overall figure for long-term unemployment (+12.2%), a trend that could be linked, in some cases, with the definitive exit from the labour market of people who had been seeking a job for more than 12 months. These dynamics have led to a notable increase in the unemployment rate, rising from 6.7% in 2008 to 7.8% in 2009. However violent, the impact of the international crisis on the Italian labour market seems to have been less devastating that in other European countries: on the basis of the OECD data, in the area as a whole the unemployment rate grew from the 6.1% of 2008 to 8.3% in 2009. With the exception of countries like Germany and the Netherlands, where lower increases in unemployment rates have been recorded, the other nations have shown more substantial increases: in France, the share of people looking for employment out of the total workforce has risen from 7.8% to 9.5%, in the United Kingdom from 5.6% to 7.6%, in the United States from 5.8% to 9.3%. In the European Union as a whole, the rate has risen to 8.9%, from 7% in 2008, while the consequences of the negative situation are even more evident if looking only at the Eurozone, where the rate leapt to 9.4% from 7.6% a year earlier. The fact that Italy held up better is due essentially to the possibility, absent elsewhere, to turn to the lay-off pay relief scheme: in 2009, the number of hours authorised amounted in fact to almost 915 million, 301.7% more than the previous year, evidence of the massive recourse to social safety nets made by the Italian companies hit by the crisis.
The dynamic of Piemonte's labour market does not differ particularly from the situation found at the national level. People in employment in Piemonte fell by about 25,000, 1.3% less compared to 2008; in contrast to what happened in Italy as a whole, in Piemonte the female component has turned out to be weaker than the male part, with a negative variation of 1.6%, against -1.1% recorded for male workers.
The overall dynamic is the result of net fall in those employed in industry, only in part compensated by an increase in agriculture and construction. As an overall effect, the employment rate of the population aged between 15 and 64 dropped more than one per cent, from 65.2% to 64%. The rate also stayed the same in 2009, higher than the national average, but lower than the average of the north-western regions (65.1%).
Again in Piemonte, the crisis had particularly serious effects for younger workers. The fall in employment has been, in addition, heavier than the annual average for both workers who had only finished middle school and those with at least a degree. Finally, the contraction in the demand for labour has been tighter for workers with temporary contracts.
The fall in demand for labour is also associated in Piemonte with a growth in the number of people seeking employment (+36.1%); the unemployment rate thus rose from 5% to 6.8%.
Shifting attention to the beginning of 2010, the weak signs of recovery glimpsed on the international and national economic scenarios from the strictly production point of view are not matched by positive indications for the labour market. All the main international research institutes agree that, even in the event of a partial recovery of other indicators, those regarding the labour market will continue to worsen at least until the second half of 2010. On the basis of the latest indications given by the OECD, in April the unemployment rate for the area was 8.7%, stable compared to March 2010, but 0.6% more than in April 2009. In Italy, the value of the indicator rose in the same month to 8.9%, 1.5% more than in April 2009, while in Piemonte, in the first quarter of the year, the percentage of the unemployed out of the whole workforce reached the record level 8.0% (7.0% in the first quarter of 2009).