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2020/04/03 / Erste Group Research

Week ahead | Labour markets face historical challenge

In the labor market data of large Eurozone countries published so far for the month of March, traces of the coronavirus crisis are already visible. Government aid measures will therefore play a key role in supporting the labor market. As a contribution to solving the problem, the European Commission this week proposed the creation of a temporary fund (known as "SURE" for short) to jointly promote short-time work.

In Austria, the number of people registered as unemployed rose to 504 thousand, compared to 334 thousand in February, which makes it a 51% percent increase. Compared to March 2019, the number of unemployed grew by almost 66%. As a difference vs. the financial crisis of 2008/09, when most of the unemployment came from industry, this time it is the services sector most severely hit.

Initial jobless claims in the US have increased rapidly over the last two weeks - first by over 3.3mn, then 6.6mn. These 10mn represent a good 6% of the workforce. But the real question is how quickly employment will rise again after the crisis. There is a great deal of uncertainty about this and it will depend largely on when containment measures can be eased or withdrawn, which is particularly difficult to assess. However, it still seems unlikely in April.

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General information

AuthorErste Group Research
Product nameWeek ahead
Topic in focusMacro/ Fixed income
Economy in focusEurozone, United States
Currency in focusEuro, US Dollar
Sector in focus-


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