Greece: dole stops after a year

Unemployment fuels poverty leaving many struggling to survive

University students burn a European Union flag during a rally against a planned overhaul of the Greek university system in front of the parliament in Athens last week.  Photograph: John Kolesidis/Reuters

University students burn a European Union flag during a rally against a planned overhaul of the Greek university system in front of the parliament in Athens last week. Photograph: John Kolesidis/Reuters

Wed, Apr 3, 2013, 06:10

Facing its sixth year of recession, Greece is dealing with the massive social and economic impact of having highest unemployment rate and the highest youth unemployment rate in the euro zone, as well as the highest unemployment rate in its recent history.

According to the most recent figures from the country’s statistics agency, last December 26.4 per cent of the workforce was unemployed, up from 10.5 per cent in the same month in 2009, after the country revealed that its deficit was much larger than previously recorded, triggering the financial crisis, troika bailouts with stringent conditions and the spiral for hundreds of thousands into joblessness.

In a country that had a weak social security system to start with, the government has struggled to meet the costs of joblessness. Last year, when the minimum wage of €751 was slashed by 22 per cent (or 32 per cent for under 25s), the government cut the basic rate of unemployment benefits back from €460 to €360 a month.

As dole is only paid out for a year, most of those now registered as unemployed receive little or no assistance from the state.

Unemployment has fuelled poverty and left swaths of society struggling to survive. According to EU figures for 2011, just over three people in every 10 in Greece – or 31 per cent – was deemed at risk of poverty or social exclusion because their household earned less than 60 percent of the national median income.

The country’s youth is bearing the brunt of joblessness, with youth unemployment more than twice as high as the overall figure. In December, 57.5 per cent of under 25s had no jobs, down slightly on the previous month, when the figure was 62 per cent. As they have never held a job, most jobless young people receive no dole and are dependent on their families for support.

In an effort to cut youth unemployment, the government has launched an action plan to get people under 30 into jobs. Under the scheme, 35,000 young jobless people would work for five months (or 500 hours) in a private company for a “benefit” of €2,000.

While it’s estimated that about 1,000 people lose their jobs in Greece each day, hundreds of thousands of those in jobs don’t get regular pay. According to the country’s largest trade union federation GSEE, roughly two-thirds of all private sector employees – a million people - have had their hours cut or get paid several months late.

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