Carpenter at work with electric saw

The unemployment anomaly in Italy

Business News

The unemployment figures for Italy in July 2023 showed an increase to 7.6%. Meanwhile, Italian companies have failed to fill more than half the positions needed for September. If there are all those jobs available, why is unemployment on the rise?

On 31st August, ISTAT (Italian National Statistics Institute) reported that the number of employed people fell, while unemployed and inactive persons increased in July 2023. However, according to a study by the chambers of commerce union Unioncamere and the National Agency for Active Labour Market Policies (Anpal), Italian companies are struggling to fill the more than half a million available positions required for September.

Unemployment position July 2023

On a monthly basis, the decrease of employment (-0.3%, -73,000) concerned both men and women, and people aged 25-49. Overall, the employment rate dropped to 61.3% (-0.2%).

In July, the growth in the number of unemployed persons (+1.9%, +37,000) involved both genders and persons between 25 and 49 years of age. The unemployment rate rose to 7.6% (+0.2% over June 2023); the youth rate declined to 22.1% (-0.2%).

In July, the number of inactive persons aged 15 to 64 increased for men and for people under the age of 35. The inactivity rate remained stable at 33.5%.

In the period May-July 2023, with respect to the previous quarter (February-April 2023), employment increased (+0.5%, +119,000).

Compared with July 2022, the number of employed persons rose by 1.6% (+362,000). The growth concerned both genders and all age groups except 35-49 years. The employment rate showed an increase of 1.1%.

On a yearly basis, the rise of employed people was accompanied by a decrease of both unemployed (-3.8%, -76,000) and inactive persons aged 15-64 (-2.9%, -371,000).

Companies fail to recruit for September

Whilst unemployment rose in July, the search for staff in September has stalled.

Italian companies have been able to hire less than half of the staff needed to meet their business needs in September, according to a study by the chambers of commerce union Unioncamere and the National Agency for Active Labour Market Policies (Anpal).

Italian businesses were looking to hire 531,000 workers in September, according to the study. This is 7,000 more than in the same month in 2022.

However, they said they were struggling to fill more than 252,000 of the available posts. “Lack of candidates” was cited as the reason in 31.7% of cases and “inadequate level of preparation” in 12%.

Unioncamere and Anpal said toolmakers, carpenters, construction workers specialised in finishings and blacksmiths are among some of the most difficult workers to find.

Employment difficulties do not lie in the south, but rather in the north of the country.

At a territorial level, companies in the North Eastern regions show greater difficulties in finding them, where 53.4% of the staff wanted are difficult to find. This is a considerably higher share than recorded in the South and Islands (43.5%) and in the Centre (45.9%). Meanwhile the value in the North West (47.4%) remains close to the average.

In particular, for the main regions, in terms of hiring flow, the following quotas of recruitment difficulties emerge: in Lombardy 122,000 contracts and recruitment difficulties equal to 46.5%. In Lazio 56,000 and 38.0%; for Veneto 52,000 and 54.4%, in Emilia-Romagna 49,000 and 51.9%. Lastly, in Campania 42,000 and 41.0%.

What does the future hold?

A report by Mestre’s CGIA paints a bleak picture about future employment with a falling birthrate and lack of skills among young workers.

The report states by 2027 – only 4 years from now – 3 million people will be eligible to retire. However, with school dropout rates high and a seeming lack of skills in the manual labour sector, this could pose serious problems for the future of Italian businesses.

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