Eurozone economy at risk

            

The euro-zone; is officially known as the Euro area, is an economic union of 17 countries. The 17 countries use the euro as their currency. Over 3 years, the euro area has faced a downfall in the economy. Although once the Euro area is one of the leading countries in the world, but they are now facing difficulties. China has now beaten them as the most economically stable.

In the current situation, the euro area is facing a terrible unemployment rate. The unemployment rate is holding a record for the worst in the euro area history. The graph below shows the heightened rate of the unemployment;

The unemployment of these 17 nations has increased 11.3% in July according to the European union's statistics. The trouble does not end there for the Eurozone, there are more mess occurred that is the Inflation rate is also escalating. Inflation, a persistent fall of value of the currency and a rise in the price level had set the eurozone into a crazy frenzy. The inflation is mostly driven by energy and food prices. With the unemployment rate increasing, the inflation rate is also increasing! This situation is known as Stagflation. Stagflation is rising the prices of goods while unemployment is prevailing and this will cause the national income of the country to be stagnant. 

               Europe's biggest engineering company SIE has made a decision to cut 500 job cuts ending of August. The Chief Executive Officer Peter Loescher is lowing the profit target. The stagflation of the eurozone had made so many losses over the years that the Europeans are having a lot of debts.  The unemployment in this situation is called the structural unemployment. This is because Cyclical unemployment are demand deficient unemployment. It is affected by the economy recession and the deficiency of demand. The Euro area is trying their best to prepare themselves for the worst and also trying to work as a team to solve this problem. There are some issues about Greece circulating that the country owes so much money that it probably will be kicked out of the country. I wish for the best in their countries and for my country too.