European Labour Market Barometer: Biggest rise recorded so far
The European Labour Market Barometer climbed to 103.3 points in May. With a rise of 2.0 points compared to April, the leading indicator of the European Network of Public Employment Services and the Institute for Employment Research (IAB) therefore registered its strongest growth since its records began. “The grip of the pandemic is easing,” says IAB head of forecast Enzo Weber, feeling optimistic. “Europe’s labour markets are starting to recover.”
The outook having been cloudy for a long time due to the COVID crisis, the European employment services currently no longer expect to see a relevant deterioration in the labour markets in any of the participating countries. Upward leaps of at least 2.0 points have been recorded by Denmark, Iceland, Austria, Liechtenstein, Portugal and Germany.
The outlook is optimistic regarding both employment growth and unemployment. The sub-indicator for the future development of unemployment figures revealed a sharp increase of 2.7 points to 103.8 points in May. This therefore lies above the sub-indicator for employment growth, which likewise showed a marked– although weaker – rise by 1.3 points to 102.7 points.
The European Labour Market Barometer is a monthly leading indicator based on a survey of the local or regional employment agencies in 16 participating public employment services. The survey has been carried out jointly by the employment services and the IAB since June 2018. The participating countries include Austria, Bulgaria, Cyprus, the Czech Republic, Denmark, Belgium-DG, Belgium-Flanders, Germany, Iceland, Liechtenstein, Lithuania, Luxembourg, Malta, Poland, Portugal and Belgium-Wallonia. While component A of the barometer signals the development of the seasonally adjusted unemployment figures for the next three months, component B forecasts employment trends. The average of the components "unemployment" and "employment" constitutes the total value of the barometer. This indicator thus provides an outlook on the overall development of the labour market. The scale ranges from 90 (very poor development) to 110 (very good development). First, a barometer score for each of the participating employment services is determined. The European barometer is then derived from these national scores in the form of a weighted average. Without taking Switzerland into account, which participated for the first time in May 2021, the barometer would show the same score.
The time series of the European Labour Market Barometer, including its components for all 17 participating employment services, is available at http://www.iab.de/Presse/elmb-components. More information on the European Labour Market Barometer is available at http://doku.iab.de/kurzber/2020/kb2120.pdf.