EU Unemployment Kept out of Official Unemployment Rates

People who are furloughed are paid under government programs via their employers. These people still have "jobs". But are not working, or are working very few hours. They do not count as “unemployed” so are not included in the “unemployment” numbers.  

The official unemployment rates barely rose during the pandemic. But tens of millions of people stopped working due to the lock downs.

 

Under these furlough programs, the government pays companies, who pay employees between 60% and 84% of their monthly wage. In some cases, the workers work fewer hours for less pay, or don’t work at all. 

In the UK , businesses can claim 80% of a staff member’s regular monthly salary, up to a maximum of £2,500. The money must be passed on to the employee and can be increased by an employer contribution.

The unemployment rate has begun to rise as people come off furlough, and those whose jobs disappeared entered official unemployment.  More governments are extending these programs, some until 2022.

The UK. program was supposed to end October 31, 2020. Four days later, it was extended until March 31, 2021, along with new measures to support the self-employed. The Bank of England pledged an additional £150 billion of QE purchases, to create funds for buying new government debt.

Very few new jobs are being created. A surge in the official unemployment rate in the third quarter was driven by people who came off furlough programs with no job to go back to, even as the job market improved.

I don't know how the new EU lockdowns will be handled but I am confident the official unemployment rate will be misleading.

The official charts are very strange: