The Development of Unemployment in the European Union’s Labour Market Due to the Recent Economic Crisis, Using Cluster Analysis

Abstract

The recent economic recession has had a significant impact on the labour markets of the Member States of the European Union. The overall unemployment rate from low pre-crisis levels increased significantly during the crisis. The impact on different groups of the labour force, however, was not uniform. Youth unemployment in particular has become a key problem. The continuing economic problems have led to a rapid increase of long-term unemployment. The aim of this paper is, in addition to the basic description of unemployment in the European Union due to the economic recession, to find groups of similar states of the European Union in the period before, during and after the global economic crisis. A cluster analysis was used to find such groups. Individual clusters were compared in terms of labour market characteristics, especially the overall unemployment rate, the unemployment rate of young people, and long-term unemployment. Another objective of this paper is to compare how the global economic crisis impacted the composition of these groups, so in other words, to explore how individual countries responded to the economic crisis, in terms of the labour market and employment.