The Countries With the Highest Unemployment

5. Latvia

> Unemployment rate: 14.3%

> Credit rating (outlook): Baa2 (positive)

> GDP per capita: $18,254.66

> GDP growth: 5.58%

> Debt pct. of GDP: 36.42%

In 2009, Latvia’s GDP shrank by 17.7%, the largest such decline in the world that year. In the past two years, however, the country’s economy has begun to recover, as GDP rose by around 5.5% in both 2011 and 2012. The average unemployment rate also has fallen in the past two years, from 19.8% in 2010 to just under 15% last year. After receiving a loan from the European Union and the IMF in 2008, Latvia has tried to cut government spending significantly. Between 2009 and 2012, government spending fell from 44% to less than 37% of GDP. However, Latvia’s government cut spending so much that in January Bloomberg reported the IMF felt the austerity measures actually had gone too far.

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4. Slovakia

> Unemployment rate: 14.6%

> Credit rating (outlook): A2 (negative)

> GDP per capita: $24,249.11

> GDP growth: 2.03%

> Debt pct. of GDP: 52.33%

Slovakia’s 14.6% unemployment rate in February was not just among the highest recorded by Eurostat, it also marked a major step back for the nation. Just 12 months earlier, Slovakia’s unemployment rate was one percentage point lower. Additionally, the country’s GDP growth slowed for the second straight year, rising just 2% in 2012 after gaining 3.2% in 2011 and almost 4.4% in 2010. Recently, Moody’s announced it expected Slovakia to miss its budget deficit target of just 3% of GDP for 2013 due to limited demand for its goods from Western Europe, critical to Slovakia’s export-based economy.

3. Portugal

> Unemployment rate: 17.5%

> Credit rating (outlook): Ba3 (negative)

> GDP per capita: $23,385.17

> GDP growth: -3.17%

> Debt pct. of GDP: 122.99%

Portugal’s unemployment has been high for years. The country’s average annual unemployment rate has been at least 8.5% since 2005. When the EU average unemployment in 2007 was 7.2%, Portugal’s was 8.9%. Portugal currently has a Ba3 credit rating from Moody’s, with a negative outlook, just above what the ratings agency considers “high risk.” The country’s rising debt and high expenditure have exacerbated its economic and financial troubles. GDP per capita has contracted in four of the past five years, including a 3.2% decline in 2012, one of the highest of all the countries measured by the IMF.

2. Spain

> Unemployment rate: 26.3%

> Credit rating (outlook): Baa3 (negative)

> GDP per capita: $30,557.47

> GDP growth: -1.42%

> Debt pct. of GDP: 84.08%

Spain’s unemployment rate in February was 26.3%, just a hair lower than the rate in Greece. For workers less than 25 years old, the unemployment rate was even higher, at more than 55%. The difficulty of landing a job has led to protests among young workers, with some even leaving Spain in order to find work. Unlike many nations with extremely high unemployment, Spain’s government has not directly received any bailout funds. However, its banking sector required billions of dollars in aid to stay afloat in late 2012 from an emergency fund set up for eurozone countries. Between 2008 and 2012, Spain’s debt more than doubled, relative to its GDP. The IMF projects Spain’s debt burden will continue to rise in the next few years and that its GDP will fall by more than 1.5% in 2013.

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1. Greece

> Unemployment rate: 26.4%

> Credit rating: C

> GDP per capita: $24,505.04

> GDP growth: -6.38%

> Debt pct. of GDP: 158.55%

Since 2010, Greece has required funding from the rest of the eurozone in order to stay afloat. Although the rescue packages have continued to prop up Greece, the bailouts have required major austerity measures and deeply affected the economy. At the end of 2012, Greece’s unemployment rate was 26.4%. On average in 2012, 24.3% of the workforce was unemployed, well above the 17.7% rate of the year before. Many Greeks have lost their jobs, and still the economy continues to shrink. In 2010, 2011 and 2012, Greece’s GDP contracted by 4.9%, 7.1% and 6.4%, respectively. At the end of 2012, only Japan was estimated to have a larger government debt burden than Greece’s 158.6% of GDP. Currently, Greece has a credit rating of C from Moody’s, the lowest of its ratings.