Measuring the impact of the 2008 and 2011 financial crises and the 2015 recovery on the unemployment rate in Italy

• Published in: Socio-economic planning sciences 2024-10, Vol.95, p.102032, Article 102032
• Main Authors: Masserini, Lucio, Bini, Matilde, Zeli, Alessandro, Forciniti, Alessia
• Format: Article
• Language: English
• Subjects: European debt crisis; Global financial crisis; Interrupted time series analysis; Unemployment rate; Youth unemployment rate
• ISSN: 0038-0121
• DOI: 10.1016/j.seps.2024.102032

Unemployment rate is one of the most important macroeconomic indicators used by governments for setting economic policy, as it provides worthwhile information on a country's labour market condition, on the health of its economic system and on its future growth. In Italy, since the turn of the century, this indicator steadily decreased until the onset of the 2007–2008 global financial crisis, after which it saw rapid growth that continued in the subsequent years and intensified with the 2011 European sovereign debt crisis. A reversal of this trend occurred only since 2015, after almost eight years of growth, when unemployment rate began a slow decline. Using quarterly data derived from official statistics produced by the Labour Force Survey, this study proposes a counterfactual approach based on interrupted time series analysis to measure the severity of the immediate impact and persistence of the 2008 global financial crisis and the 2011 European sovereign debt crisis on the Italian unemployment rate as well as the intensity of the economic recovery in the years after 2015. Differences across population age sub-groups were considered to highlight the effects on youth unemployment, gender, macro-regions, citizenship and level of education and thus obtain a more in-depth analysis. •In Italy, UR increased after the global financial crisis and continued to rise after the European sovereign debt crisis.•Since 2015, after the introduction of the Italian Jobs Act, a weak recovery of UR occurred.•The global financial crisis consequences on UR was more severe in the south macro-region, females and low educated workers.•Impact of European sovereign debt crisis was stronger for YUR, the south macro region, low educated workers and foreigners.•A more pronounced UR recovery after Jobs Act was observed for young people, south macro-region and low educated workers.