In the second quarter of 2012, labour market and social divergence persist between Member States

The Quarterly Review presented by the European Commission shows that the unemployment and social situation in the EU remained a very serious concern in the second quarter of 2012. It is displayed on the report very significant differences between Member States, but unemployment rising overall, households' financial situation deteriorating and child poverty increasing in all of them.

The EU has been in recession or on the verge of it since late 2011 and the overall economic sentiment is at its lowest level in three years. In this context, the European Commission published its Quarterly Review on the employment and social situation in the EU. Overall, this review shows that unemployment is rising with significant differences between Member States, households' financial situation is deteriorating and child poverty is increasing. In July 2012, the EU and the euro area unemployment rates were stable compared with June.

Among the report conclusions, it is especially worrying that the unemployment is still on the rise and has climbed to 25.3 million, a historically high level, up by 2.6 million (+11.6%) compared to March 2011. In addition, there is now an all-time record gap of 20.6 percentage points between the EU's lowest (Austria, with 4.5 %) and highest (Spain, with 25.1 %) unemployment rates. The number of long-term unemployed has increased in 15 Member States since last year and reached 10.7 million. The long-term unemployed now account for 4.5 % of the active population (+0.4 percentage points over the year). Moreover, youth unemployment is at a dramatic level - 22.5% in the EU in July – though it did not increase further in the second quarter. Twelve Member States recorded rates above the 25% mark, and only three remain under 10%: Austria, Germany and The Netherlands.

Between 2009 and 2011, gross household disposable income declined in two-thirds of EU countries, with the largest drops recorded in Greece, Ireland and Lithuania, Spain, Cyprus and Hungary. This evolution is in stark contrast with the situation observed in the Nordic countries, Germany, Belgium, Slovenia and France where welfare systems and more resilient labour markets have allowed overall incomes to continue increasing during the crisis. However, the crisis affected significant shares of the population and caused poverty to rise also in these countries. Besides, child poverty is becoming an issue for a growing number of households because of insufficient earnings from parental work and inadequate support to households with children. The percentage of children at risk of poverty (after social transfers) range from around 10% in Denmark and Finland to over 20% in Spain, Greece, Bulgaria, Portugal, Italy, Romania, Latvia, Poland, Lithuania and Luxembourg.