Eurozone unemployment rate falls to near 4-year low

LONDON — Unemployment across the 19-country eurozone economy has fallen to its lowest level in nearly four years, official figures showed yesterday, in another positive sign for an economic region that has struggled to get people back to work for years.

The decline is unlikely to deter the European Central Bank from injecting another dose of stimulus into the eurozone this week. Many economists say further stimulus could help shore up the economic momentum that appears to be building in some countries, even laggards like Greece.

Figures from the European Union's statistics agency showed the unemployment rate across the region fell in October to 10.7 percent from 10.8 percent the previous month, after a 13,000 decline in the number out of work to 17.24 million.

Eurostat said the unemployment rate, which has fallen by 0.8 percentage point over the year, is now at its lowest level since January 2012. Since October 2014, the number of people out of work has fallen by 1.3 million.

Big disparities remain across the region. While Germany's unemployment rate is 4.5 percent, Spain's stands at 21.6 percent despite large falls over the past year.

The improving labor market trends have come alongside a modest pick-up in economic activity. The eurozone has been posting quarterly economic growth in the 0.3-0.5 percent range for around a year and some recent indicators suggest the recovery may be gaining traction.

On yesterday, financial information company Markit also confirmed that its purchasing managers' index for the eurozone's manufacturing sector — a broad gauge of activity — rose to 52.8 points in November from 52.3 the previous month. Anything above 50 points to expansion.

November's rate was the highest since April 2014 and suggests a crucial part of the eurozone economy has withstood a series of headwinds, notably an economic slowdown in China, the world's number 2 economy.

Markit said its survey showed production levels and new orders were up in all countries bar Greece, which is expected to fall back into recession following its protracted bailout negotiations with creditors this year that led to the imposition of strict controls on money withdrawals — many of which are still in place. Still, even Greece, appears to be on the mend. Its manufacturing survey was way off lows his earlier this year and just below the no-change threshold at 48.1 points.

The positive economic signals are not expected to prevent the ECB from doing more on Thursday, such as increasing its 1.1 trillion-euro ($1.2 trillion) monetary stimulus or making commercial banks pay more to park their cash at the central bank.

"The scene is set for the ECB to unleash further stimulus at its December meeting to ensure momentum continues to build," said Chris Williamson, Markit's chief economist.