Youth unemployment soars to new highs

(ANSA) - Rome, September 30 - The Italian economy, mired in recession, was hit with more bad news Tuesday with reports showing continued deflation in September - evidence of ongoing weakness - as well as a dramatic jump to new record highs in youth unemployment.
    The jobless rate among young Italians rose to 44.2% in August while unemployment overall fell slightly to 12.3% during the month, national statistics agency Istat said.
    Unemployment among Italians between 15 and 24 who are in the job market reached levels not seen since 1977 when Istat first began keeping these specific records.
    Youth joblessness also rose 1% compared with July and jumped by 3.6% compared with the same time last year.
    That is bound to be a serious concern for Premier Matteo Renzi, whose government - like administrations all over Europe - have made reducing unemployment among young citizens a high priority.
    A summit on unemployment organized by the European Union is planned for October 8 in Milan.
    Farm organization Coldiretti said that poor summer weather contributed to the record-high levels of youth joblessness by reducing the number of temporary jobs related to tourism and even early fruit harvests.
    "A crazy summer" of cool weather and heavy rains in parts of the country cut work for temporary lifeguards, cooks and waiters at tourist spots as some 4.2 million people changed their holiday plans because of the bad weather. Meanwhile, the economy recorded its second straight month of deflationary numbers in September, with the annual consumer price index below zero, Istat said.
    That triggered calls by consumer groups for a day of protest on November 8 against "the dire state of the Italian economy" brought about, in part, by excessive taxation.
    Italy has slipped into its third recession since 2008 and many experts say there is a danger deflation could gain a strong hold over the economy and make recovery very difficult.
    Buttressing that argument are the latest figures showing the annual inflation rate was -0.1 in September, the same negative rate as recorded in August, when deflation hit the Italian economy for the first time since September 1959. Both inflation and the jobless rate send important signals about the strength, or weakness, in an economy.
    Policy-makers often aim to hold inflation at about 2%, which many judge to be the right amount to ensure adequate growth without driving prices too high.
    The fall in inflation in September was again led by a drop in energy prices as was the case in August, Istat said.
    After energy prices fell by 1.2% in August, the drop accelerated in September to fall by 2.8%.
    That also contributed to a fall in food prices because of lower transportation costs for fresh items.
    The core rate of inflation, which excludes volatile energy and food prices and is most closely watched by policy makers, was stable at 0.5% in September.
    Italy's European Union-harmonized index of consumer prices (HICP) rose by 1.8% in September compared with August, but fell by 0.2% compared with September 2013, Istat said.
    It also warned that economic weakness has likely continued in the third quarter, although the weak euro would help exports.