Greece’s economy was still shrinking and unemployment remained above 10 percent at the end of 2009, just before the government announced harsh spending cuts that are expected to drive the country deeper into recession, official data showed on Friday.
The National Statistics Agency said the economy contracted by 2.5 percent in the fourth quarter and that the jobless rate was 10.2 percent in December. That rate is down slightly from 10.6 in November but up from 8.9 percent a year earlier.
It said 505,110 people were recorded as being out of work in December out of a total population of about 11 million.
The data offers a snapshot of the economy before the government announced spending cuts that are expected to hit the country hard.
Last week, the government toughened its austerity measures, with wage cuts and tax hikes worth an extra euro4.8 billion ($6.5 billion) in savings, in an effort to ease Greece’s massive deficit that has unsettled the euro currency and markets globally.
Development Minister Louka Katseli, said the additional cuts meant that recession in 2010 would be worse than the official estimate of a 0.3 percent contraction of gross domestic product.
“The recession will definitely be worse than predicted,” Mr. Katseli said in a Greek television interview on Tuesday, predicting a “steady recovery from 2011 onwards.”
Greece’s main labour unions held a second 24—hour general strike in a week on Thursday to protest the austerity measures. The action halted flights and services, while police again clashed with violent demonstrators during anti—government rallies in central Athens.
On Friday, the leader of Greece’s powerful civil servants union, ADEDY, said he had asked the government to delay negotiations to reform the country’s troubled pension system, warning that the pressing need for fiscal improvement could lead to an “annihilation of pension rights for workers.”