February 28, 2014 / 9:07 AM / 4 years ago

Italy January jobless hits new record 12.9 percent

(Reuters) - Italy’s seasonally adjusted unemployment rate rose to a new record of 12.9 percent in January, its highest level since records began in 1977, data showed on Friday.

Youth unemployment, measuring job-seekers between 15 and 24 years old, was 42.4 percent in January, up from 41.7 percent in December. Youth unemployment is also at its highest level in 37 years.

The weaknesses in Italy’s labour market are equally evident in its chronically low employment rate, which was at 55.3 percent in January. Istat said there were 478,000 fewer people in employment at the end of 2013 than a year earlier and 984,000 fewer than in 2008.

In January, there were 3.293 million registered unemployed, 60,000 more than the previous month, and 260,000 more than the same month last year, ISTAT said.

The data underlines the challenge facing new Prime Minister Matteo Renzi, who has promised to make cutting unemployment the top priority for his government. He is expected to unveil a new “Jobs Act” that aims to lower labour costs and simplify the complex system of employment contracts widely blamed for deterring Italian employers from hiring new staff.

The International Monetary Fund called this week for structural reforms of the labour market to cut unemployment, which has been rising steadily since early 2011 as Italy has struggled in its longest postwar slump.

Reporting By James Mackenzie; james.mackenzie@thomsonreuters.com

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