Greece's Convergence to EU Standards: Is It Feasible for Greece to Attain an Unemployment Rate Below 10%?

Liargovas, Panagiotis; Bertsatos, Georgios; Agiomirgianakis, George; Sfakianakis, George

doi:.0.0.0

Panagiotis Liargovas, ^1,2 Georgios Bertsatos, ^1,3 George Agiomirgianakis, ^4,5 George Sfakianakis, ^5,6,7

^1,21Centre of Planning and Economic Research, Athens, Greece / University of Peloponnese, Tripoli, Greece
^1,31Centre of Planning and Economic Research, Athens, Greece / Gulf One Lab for Computational & Economic Research, U.K.
^4,54Hellenic Mediterranean University, Heraklion, Greece / Hellenic Open University, Patras, Greece
^5,6,75Hellenic Open University, Patras, Greece / National and Kapodistrian University of Athens, Athens, Greece / Hellenic Scientific Institute on the Economics of Education & Life-Long Learning, Research, and Innovation, Athens, Greece

Corresponding Author: George Agiomirgianakis ,Email: georgeagios@hmu.gr

ABSTRACT

Given the theory of efficient unemployment and using Eurostat data, it turns out that the average annual unemployment in Greece over the last -at least- 15 years has been consistently below 10% when job vacancies are considered. Given that based on cumulative data for the period 2010-2022 job vacancies are estimated to be between 98 thousand and 123 thousand, we argue that an appropriate indicator for the degree of slackness/tightness of the Greek labor market should combine both unemployed persons and job vacancies. That is, the u* indicator of the full-employment rate of unemployment (FERU). Our analysis shows that if the positive trends of the declining unemployment rate and increasing job vacancy rate continue, a full-employment state could be reached even in the next 3.5 years converging to EU standards.

JEL Classification

E24: Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital
E61: Policy Objectives; Policy Designs and Consistency; Policy Coordination
J63: Turnover; Vacancies; Layoffs
J64: Unemployment: Models, Duration, Incidence, and Job Search
O52: Europe

Keywords: Labor Market | Unemployment | Vacancies | Greece