Greece's labor market is entering a crucial phase as of today as the government launches a key program supporting businesses that reduce the number of days worked by staff members and the tourism sector opens for business.
While job positions in Europea have been disappearing fast due to the coronavirus, the latest data from Greece's statistics office (Elstat) show a drop in jobless figures due to the methodology adopted. However, as of today some clear trends in the labor market are likely to emerge for the short and medium term.
After a joint ministerial decision signed by the finance, development and labor minister, Greece has started a worker program, called SYN-Ergasia (meaning 'working together' in Greek) that will run for the next four months.
Without the consent of employees, employers will be able to reduce the days worked by staff members per week by up to 50 percent. The government will partially cover losses for employees, paying for 60 percent of gross income that has been lost, along with the respective social security contributions.
It is a move designed to support the labor market but many workers fear that inclusion in this program will soon be followed by them losing their job as turnover levels among many companies still remain very low. According to some estimates, some 700,000 worlers will be initially included in the work scheme.
Despite Elstat's jobless figures for March, which show a drop in unemployment to 14.4 percent from 15.9 percent in February, data from the Labour Ministry's Ergani system show a different picture.
In particular, Ergani data shows that between January and May 2020, only 5,826 new jobs were created, compared with 265,059 in the same period last year. Thus, the new jobs were 259,233 less than last year, in the labor market's worst performance since 2001.
The Elstat data may be revised next month. In a statement, the statistics office said that the decrease was mainly the result of an increase in economically inactive workers as many job seekers reported that they were not immediately available to work due to the current conditions and therefore they were classified as being inactive, in accordance with EU regulations.
Of course, the tourism industry, which opens its doors today will play a decisive role in the labor market. Although the landscape remains unclear as to which companies will operate this season, the industry and its 700,000 employees (according to Tourism Minister Haris Theocharis) are entering a challenging phase that will be of importance for the wider economy.