Nicholas-Fourikis: The Greek Financial Crisis: light at the end of the tunnel?

The Greek Financial Crisis: light at the end of the tunnel?

The (EU / IMF) imposed austerity measures on the Southern European States, (SES) which could not service their excessive loans compared to their GDP. Moreover theEU encouraged the SES to eliminate waste and adopt practices which promote innovation and world competitiveness. As can be expected high unemployment figures resulted.

The following comparisons are here made between the highly competitive Northern European States and the SESs. The lowest unemployment rates were recorded in Austria (4.9%), Germany (5.2%) and Luxembourg (5.9%) while the highest rates were recorded in Greece (27.6% in July 2013) and in Spain (26.6%) [1]

While these figures cause concern, the youth unemployment figures for the SESs are alarming. The lowest youth unemployment rates were observed in Germany (7.7%) and Austria (8.7%) and the highest in Greece (57.3% in July 2013), Spain (56.5%) and Croatia (52.8% in the first quarter of 2013)[1]

In the light of these statistics it is not surprising to read that many professional Greeks migrated to the prosperous Northern EU States or to non-members states of the EU. While reference [2] is a qualitative report of the exodus of professional Greeks out of the country, reference [3] claims that 120,000 professionals left Greece since 2010, the start of the country’s financial crisis in search of better opportunities. And that high figure, which constitutes 10 percent of the country’s potential, is very high according to Lois Lambrianides, the study’s director.

The professionals consisted of doctors, engineers, IT professionals and scientists who found it increasingly difficult to find work amid deep cuts to funding of health care and other publicly supported sectors.

Giorgos Christides writes [2] “In an era characterized by intensified global competition for talented, innovative and highly-skilled workers, the brain drain afflicting Greece means the country is losing its best hope of revival.

“Viewing your country as a dead-end and a prison is therefore a more daunting and condemning prospect than defaulting or exiting the euro.”

According to a 2012 Gallop poll Greeks remained the world’s most pessimistic nation [4] . More explicitly 38% of Greeks rate their future lives worse than their current lives.

A recent report is what most observers were waiting for.

“Greece’s recession eased in the third quarter of this year (2013) while the unemployment rate stood at 27.3 per cent in August, unchanged from the previous month. The government has described the stabilization in the job market as the "first sign of recovery" [5].

Undoubtedly this is good news but it is too early to crack open a bottle of champagne; we have to wait for more positive data in the next few months before we begin the celebrations.

References

1 “Euro area unemployment rate at 12.2 %.” 159/2013 – 31 October 2013

Sept 2013. http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/3-31102013-BP/EN/3-31102013-BP-EN.PDF

2 “Greece brain drain 'wrecking my social life.” 23 June 2012 . Giorgios Christides

http://www.bbc.co.uk/news/magazine-18542449

3 SPIEGEL ONLINE. “Brain Drain.” 120,000 Professionals leave Greece amid crisis. 10/04/2013

http://www.spiegel.de/international/europe/unemployment-and-recession-in-greece-lead-to-brian-drain-a-893519.html