Youth unemployment in Italy at four decade high

Youth in Italy are having real tough time even after improvement in outlook. Where business outlook and sentiment has improved this year, over ultra-loose monetary policy from European Central Bank (ECB). It has so far been a jobless recovery.

Italy's situation makes it clear that improving sentiment is not going to bring the work force back in payroll alone, it requires policies to improve growth.

• Latest job report from Euro zone showed, situation hasn't improved in Italy's job market. Italy's unemployment rate has actually edged up to 12.7% in June from 12.5% in May.

High school and university graduates are still struggling to secure a job, pushing youth unemployment rate to 44.2%, highest since 1977.

We have clearly been arguing that -

• Monetary policy alone is simply not enough, growth friendly policies from fiscal side are clearly required to improve outlook.
  
  
• Euro zone will not be able to achieve the desired inflation without bringing people back to workforce. An inflation without recovery in jobs will have unduly consequences.

• Improving the employment scenario would actually bring back demand driven inflation.