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Eurozone Unemployment Hits 10 Percent

Unemployment in the 16-nation eurozone reached a record 10 percent in February. The level is the highest since the euro currency was introduced a decade ago.

Figures published by the European Union's statistical office Eurostat show unemployment for the eurozone edged up to the record amount, and inflation jumped to its highest level in 15 months.

Unemployment rates varied sharply among the 16 countries sharing the euro currency, with the Netherlands posting only a four percent unemployment rate in February. By contrast, unemployment was nearly 22 percent in Latvia and 19 percent in Spain.

But Center for European Reform Senior Researcher Philip Whyte, says the figures are not as bad as they could be.

"It is true that it is bad news for the eurozone," he said. "But it is worth remembering that if you said at the beginning of 2009 that the unemployment would be where it was now, a lot of people would have said that was a relatively favorable outcome, given how far the economies have contracted."

The unemployment rate adds to the eurozone's mounting problems, which include Greece's economic crisis. Last week, EU leaders pledged a last-resort aid package for Athens in a bid to shore up confidence in Greece, so it could borrow at more favorable rates. But early indications suggest Greece's borrowing costs remain high.

Whyte also predicts the European Union will have a hard time pulling out of the recession and that will affect the labor market in the long term.

"I think what this means is that growth is going to be slow, demand for labor is not going to be growing particularly quickly, and I think unemployment in Europe is going to be persistently high," he said.

Meanwhile, analysts attribute the spike in inflation to energy price rises, and in a spot of good news, they predict the rise will be temporary.