Greek poverty deepens as unemployment hits record 27 per cent
A pedestrian passes with his umbrella next to a storefront of a department store as a man begs for money in central Athens, Thursday, Feb.14, 2013. (AP Photo/Thanassis Stavrakis)
The Associated Press
Published Thursday, February 14, 2013 1:00PM EST
ATHENS, Greece -- Unemployment in Greece rose to a record 27 per cent in November as a result of the financial crisis and austerity measures that will leave, according to one survey, nearly a third of the population in poverty by the end of the year.
The Statistics Agency said unemployment increased from a rate of 26.6 per cent in October and 20.8 per cent in November the previous year. More than 30,000 people lost their job in November, the agency said, with the jobless rate accelerating from earlier in the year.
Worst affected are the young, with 61.7 per cent of those in the 15-24 age group without a job.
Greece is mired in the sixth year of a recession, and has been relying for nearly three years on international rescue loans to keep it afloat. In return for the bailout, the government has imposed major spending cuts and tax hikes which have hammered the economy, causing an increase in poverty and forcing thousands of businesses to close.
The economy contracted a further 6 per cent in the fourth quarter of 2012 from the previous year, the statistics agency said. That followed annual contractions of 6.7, 6.4 and 6.7 per cent in the previous three quarters of 2012.
New tax hikes that went into effect this month have added further pressure on the shrinking workforce: 3.6 million Greeks remain employed, but 3.3 million are registered as inactive and 1.35 million are unemployed, according to the November figures.
A study by Greece's largest labor union, GSEE, released this week projected that 3.9 million out of Greece's total population of nearly 11 million will be officially living in poverty by the end of the year, compared with 3.1 million in 2011. The poverty line in Greece is set at a personal income of less than (EURO)7,200 ($9,700) per year.
Ioannis Kouzis, associate professor at Panteion University's social policy department and adviser to GSEE, said the union's research suggested the jobless rate would hit 30 per cent later this year.
"There are 470,000 households without anyone working," Kouzis told private Skai television.
"When the (austerity) measures started, unemployment was at 9 per cent. Since then, incomes have been crushed and the official unemployment rate has reached 27 percent ... So the notion that lower salaries will boost employment has proved to be totally false."
Several hundred pensioners marched to the Labor Ministry in heavy rain to protest the new tax increases.
"We are not just talking about some problems. They are taking our lives away," Dimos Koumbouris, leader of Greece's main pensioners association, told the AP.
"We can't pay our electricity bills, or the emergency taxes. We haven't enough for our medicines, and it's putting our lives in danger."
Unions have called a general strike for Feb. 20, protesting the new tax hikes and a government decision to ax collective wage agreements in the public sector as part of an overhaul in pay scales for state-paid employees.
A furor has also erupted over whether there are plans to further reduce the minimum wage, which currently stands at just above (EURO)500 ($666) a month.
The government has come under attack from the main opposition Syriza party after Finance Ministry General Secretary Giorgos Mergos this week said the minimum wage "remains at high levels, and this is something we have to be careful of in our course towards development."
Syriza's youth wing briefly occupied Mergos' academic office earlier Thursday -- a common form of protest in Greece. The party accused the police of using force against the protesters.
The government has strenuously denied there are any plans to cut the minimum wage, or that this has been demanded by the country's debt inspectors.
The EU's monetary affairs commissioner, Olli Rehn, noted that under Greece's agreement with its bailout lenders, "a review of the minimum wage system is provided for in 2014." His spokesman stressed "there is no explicit, or even implicit, agreement that there should be further cuts."
Raf Casert in Brussels, and Srdjan Nedeljkovic and Thanassis Stavrakis in Athens contributed to this report