The downturn in the euro-zone labour market is gathering pace. Another very sharp rise in unemployment in February took the total increase so far to over 2 million. With 1.6 million of that pick-up occurring in just the past six months, conditions are deteriorating at an unprecedented rate. Survey measures of hiring intentions point to annual falls in employment of around 1% in the coming months, consistent with a further sharp increase in unemployment. This deterioration looks set to offset the positive effect of falling inflation on real incomes, denting the prospect of a recovery in the consumer sector.
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