Meteoric rise of 82.45% in layoffs, fears about the course of unemployment

Fears about the course of unemployment immediately after the recession of the pandemic and the lifting of employment protection measures have been expressed by the European Commission since September 2021 through the evaluation reports of the Greek economy.

This forecast is now a reality, as the data of the labor ministry’s information portal ERGANI and the Hellenic Statistical Authority – ELSTAT for the first two months of the year (January – February) record an explosion of redundancies and “resistance” of unemployment to the rates formed in the last months of 2021.

The reaction of the labor market after the beginning of the lifting of the restrictive-protective measures, was the big question of all the Economic Organizations inside and outside the country.

The first answer is given by the records of the first two months of the year. A veritable explosion of dismissals and departures. From 165,725 redundancies – departures in the first two months of 2021 we reached 302,366 in January – February of this year. That is 136,641 more redundancies, an increase of 82.45% !!!

The Ministry of Labor, commenting on the data on employment flows, typically states that “in January 2022, there were more departures – layoffs, mainly due to the lifting of restrictive measures taken last year to protect public health.”

And of course there are fears that the rise in redundancies will continue until the labor market balances on the “new reality”, when protection measures are – completely – lifted.

This situation is also reflected in the unemployment rates recorded by ELSTAT, as in January the downward trend of the unemployment rate was stopped with the percentage remaining at 12.8% (as in December). The unemployed reached 587,152 people, just 7,100 fewer than in December 2021 (a decrease of 1.2%).

The European Commission report – September 2021 – raised concerns about developments in the labor market with the lifting of safeguards, such as the suspension of contracts and other restrictive measures deemed necessary due to the economic impact of the pandemic. All financial institutions – inside and outside the country – questioned the market reaction after the lifting of safeguards. Indicative was the “approach” of the General Confederation of Workers – GSEE Labor Institute, which expressed fears about the evolution of labor market elements when the “distorting lens” of the measures disappears. The Institute considers that there is a high risk of rising unemployment and proposes interventions aimed at protecting employment.