Nearly 25 million people unemployed in EU

Eurostat, the statistics boffins in Brussels, have released their latest figures (or estimates).

They estimate that 10,2% of the workforce is unemployed. When you read their report this is presented rather clinically. What impact does the rise from 9.9% to 10.2% have on your own situation?

And then you realise that they estimate that 24.772 million people are unemployed in the European Union. Nearly 25 million people! That is nearly the whole population of the Netherlands and Belgium put together. Imagine towns or even provinces where no one has a job! Truly scary.

In the USA the situation seems slightly less worrying. The last reported unemployment rate was at 8.2 percent in March 2012, however this has been rapidly decreasing from a peak of 9.8% at the end of 2010.

United States Unemployment Rate

From 1948 until 2010 the United States’ unemployment rate averaged 5.70 percent reaching an historical high of 10.80 percent in November of 1982 and a record low of 2.50 percent in May of 1953.

Europe on the other hand never had such low levels of unemployment.

Historical Data Chart

Experts struggle to explain why unemployment levels are so consistently high compared to the USA. They quote new technology, foreign competition and ‘Eurosclerosis’ as reasons, but these do not provide convincing reasons why unemployment should have risen so dramatically, though all of them may have had some part to play. They can not come up with one single reason why so many Europeans fail to find jobs, and many of the more widely touted proposals for reform are either likely to be ineffective or politically difficult to introduce.

Having lived in several countries in Europe I can only speak from my own  experience, but I bet it is all to do with the mentality in Europe. Europeans as a whole (and especially politicians) these days are risk averse. The culture does not allow failure. Failing is seen as a loss of face and must be avoided at all costs.

In the USA on the other hand, if you fail you have learned how not to do it. It is seen as a valuable experience and not a reason to stop trying. Most successful entrepreneurs (in the EU and the USA) have failed many times before they hit the big time. One that springs to mind is (now Lord) Dyson. He begged and borrowed money from everybody he knew and fought failure for 20 odd years in order to get his cyclone vacuum cleaner to work. And he did….

Europe needs to change its attitude and let its people try things without stigmatising them as failures. The EU has started to facilitate this by opening up borders so people can work anywhere in Europe, but the massive amount of red tape, incompatible financial markets and systems, incompatible tax, employment and other laws make life extremely difficult for people to get up and do something.

Europe needs to reward people who try to change the world and not penalise them through the tax system. Business won’t grow from fat banker bonuses, but will from big awards for entrepreneurs. Bankers recycle money, entrepreneurs create it.

Just look at Germany. They still make things and the world is gagging for their products. Combine that with an efficient government, incentives for entrepreneurs and a newspaper industry with a positive attitude towards entrepreneurs and you have a recipe for success.

The rest of Europe still have a lot to learn……


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