The European Labour Market Barometer has continued its downward trend in August. The labour market leading indicator of the European Network of Public Employment Services and the IAB fell by 0.8 points compared to July, but still remains above the neutral mark of 100, standing at 100.9 points. The additional risks posed by a possible escalation of the energy crisis still persist.
The component for the unemployment forecast dropped by 0.7 points to the current level of 99.3 points, thereby falling short of the neutral mark of 100 for the first time in a year and a half, signalling an increase in unemployment. A look at the individual countries also shows this to be the case for Germany and the Eastern European countries. Here, the process of integrating Ukrainian refugees in the labour market and recording them statistically is bound to play a role.
The employment component also falls compared to July, showing a decline of 0.9 points yet again. However, with a score of 102.4 points at the moment, it still remains clearly above the neutral mark, which indicates increasing employment.
The war in Ukraine is dragging down Europe’s economy. And the integration of Ukrainian refugees is also leading to higher unemployment for the time being. Nonetheless, the European labour markets are still holding their own
reports Enzo Weber, IAB head of forecast.
A small number of countries also recorded rising barometer values in August compared to July. These include Austria, Belgium-Flanders and Belgium-Wallonia.
The European Labour Market Barometer is a monthly leading indicator based on a survey of the local or regional employment agencies in 17 participating public employment services. The survey has been carried out jointly by the employment services and the IAB since June 2018. The participating countries include Austria, Bulgaria, Cyprus, the Czech Republic, Denmark, Belgium-DG, Belgium-Flanders, Germany, Iceland, Liechtenstein, Lithuania, Luxembourg, Malta, Poland, Portugal, Switzerland and Belgium-Wallonia. While component A of the barometer signals the development of the seasonally adjusted unemployment figures for the next three months, component B forecasts employment trends. The average of the components “unemployment” and “employment” constitutes the total value of the barometer. This indicator thus provides an outlook on the overall development of the labour market. The scale ranges from 90 (very poor development) to 110 (very good development). First, a barometer score for each of the participating employment services is determined. The European barometer is then derived from these national scores in the form of a weighted average.
The time series of the European Labour Market Barometer, including its components for all 17 participating employment services, is available at www.iab.de/Presse/elmb-components. More information on the European Labour Market Barometer is available in our Magazine IAB-Forum: Launch of the “European Labour Market Barometer”