Number of Jobless People Declines Slightly in Europe

PARIS — While unemployment remained at record levels in percentage terms, the actual number of jobless people in the euro zone fell slightly in July, according to data published on Friday, offering fresh evidence that Europe’s struggling economy was taking tentative steps toward a recovery.

The tiny improvement in employment — which came alongside declining inflation and a survey showing improved confidence among European consumers and business managers — was welcomed as additional evidence that the worst of the region’s downturn was probably over. Still, officials and economists cautioned that the economic health of Europe remained fragile and the pace of recovery highly uneven within the region, underscoring the challenge for policy makers and central bankers.

“The recent improvements are minimal,” said Laszlo Andor, the European Union’s commissioner for employment. “This is no time for celebration or complacency.”

The jobless rate in the 17 countries that share the euro was 12.1 percent in July, adjusting for seasonal effects, according to a report from Eurostat, the European Union statistics agency. That figure has remained unchanged for several months. A year earlier, it was 11.5 percent.

Eurostat estimated that 19.2 million people in the euro area were jobless in July, 15,000 fewer than in from June.

For all 28 countries in the European Union, the number of unemployed fell by 33,000, to 26.7 million, for a rate of 11 percent. The European bloc expanded from 27 members to 28 on July 1, when Croatia joined.

Joblessness in the euro zone has been marching higher almost without interruption for more than five years, declining only briefly at the beginning of 2011. The July data showed the first back-to-back monthly decline in the number of jobless since April 2011.

But while some countries, like Germany, Austria and the Netherlands, have managed to weather the crisis with relatively little human cost, their Southern European neighbors — crippled by the euro zone’s debt crisis — still confront devastating levels of joblessness, particularly among the young.

“Against the background of what we’ve seen over last 18 months, yes, this is good news,” Carsten Brzeski, an economist at ING Bank in Brussels, said of the employment figures. “But tell that to the people who are still unemployed in places like Spain.”

The figures released on Friday again demonstrated the large disparity in growth and unemployment rates.

Unemployment in Germany stood at 5.3 percent in July, while Austria’s rate was 4.8 percent — less than one-fifth the levels recorded in Greece and Spain.

Andrea Broughton, principal research fellow at the Institute for Employment Studies in Brighton, England, emphasized the high levels of youth unemployment in many parts of Europe. In Greece, where the jobless rate is already among Europe’s highest at nearly 28 percent, youth unemployment was 62.9 percent in May, the latest month available for that country. In Spain and Croatia, more than half the young people remain out of work.

Nonetheless, Mr. Brzeski of ING said there were growing signs that Europe’s downturn had bottomed out and that structural reforms introduced in Spain, Portugal and other pockets of Europe’s “periphery” had begun to bear fruit.

He pointed to the European Commission survey of business and consumer confidence for August, which was also released on Friday, showing that optimism among company managers had reached its highest level in two years.

“Unit labor costs in many peripheral countries really have been improving,” he said. There was a nascent sense among businesses in those countries, he added, that “finally, something has been done and it’s showing some effect.”

The confidence survey, conducted by the executive agency of the European Union, showed that sentiment was improving not only in relatively healthy economies like Germany and the Netherlands but also in Italy and Spain, which have been among the hardest hit by the downturn.

The index of sentiment within the euro zone, based on factors including business orders, industrial confidence and hiring plans, rose 2.7 points to 95.2, the European Commission said. Across the European Union, the measure rose 3.1 points to 98.1.

Consumer confidence also improved, thanks mainly to brighter expectations about the economic situation over the next 12 months. Expectations about employment, however, remained unchanged.

Europe’s stagnant economy continued to keep a lid on prices. Eurostat on Friday forecast that annual consumer price inflation would decline to 1.3 percent in August from 1.6 percent a month earlier, largely because of a drop in energy prices.

This low-inflation trend, economists said, provides useful ammunition to the European Central Bank, which remains reluctant to raise its benchmark interest rate from a record low of 0.5 percent.

“As long as inflation remains well behaved and clearly below 2 percent,” Mr. Brzeski said, “I think the E.C.B. can sit very comfortably where it is right now.”

Economic View: Public Policies, Made to Fit People

I HAVE written here before about the potential gains to government from involving social and behavioral scientists in designing public policies. My enthusiasm comes in part from my experiences as an academic adviser to the Behavioral Insights Team created in Britain by Prime Minister David Cameron.

Thus I was pleased to hear reports that the White House is building a similar initiative here in the United States. Maya Shankar, a cognitive scientist and senior policy adviser at the White House Office of Science and Technology Policy, is coordinating this cross-agency group, called the Social and Behavioral Science Team; it is part of a larger effort to use evidence and innovation to promote government performance and efficiency. I am among a number of academics who have shared ideas with the administration about how research findings in social and behavioral science can improve policy.

It makes sense for social scientists to become more involved in policy, because many of society’s most challenging problems are, in essence, behavioral. Using social scientists’ findings to create plausible interventions, then testing their efficacy with randomized controlled trials, can improve — and sometimes save — people’s lives, all while reducing the need for more government spending to fix problems later.

Here are three examples of social science issues that have attracted the team’s attention:

THE 30-MILLION-WORD GAP One of society’s thorniest problems is that children from poor families start school lagging badly behind their more affluent classmates in readiness. By the age of 3, children from affluent families have vocabularies that are roughly double those of children from poor families, according to research published in 1995.

The research found that one of many reasons that poor children often have difficulty learning to read is that they suffer at home from what might be called a “word deficiency.” The caregivers of these children simply don’t speak or read to them as often as those in better-off families. The study estimated that by age 3, a poor child would have heard 30 million fewer words than a child growing up in a family of higher socioeconomic status.

Until recently, this word gap has been hard to address. One promising new approach is being tested by Dr. Dana Suskind, a professor of surgery and pediatrics at the University of Chicago. Parents or caregivers who want to improve their children’s language skills can be coached to improve their interactions with them. (For example, interactive exchanges are better than soliloquies.)

New technologies, like the digital language processor developed by the LENA Research Foundation, whose work focuses on language problems in young children, can aid in this effort by letting parents receive feedback on the frequency and nature of their verbal interactions with their children. (Think of it as a box score for those interactions.) Providence, R.I., has won a $5 million grant from the Bloomberg Philanthropies for a Providence Talks program to use these kinds of techniques to improve school readiness for low-income children.

In this domain, the team’s role is multifaceted. There is no silver bullet for closing the word gap, but by encouraging more trials nationwide, providing evaluation expertise and distributing results, we can help give poor children their best chance to succeed.

DOMESTIC VIOLENCE The team will primarily lend support and expertise to federal agency initiatives. One example concerns the effort to reduce domestic violence, a problem for which there is no quick fix. But a good place to start is to ensure that each component of a victim’s support system works as well as it can. One such component is the National Domestic Violence Hotline, which victims can call for advice and support. Like other call-in centers, it can become busy and put callers on hold. Many victims hang up before they’ve had a chance to speak with a counselor.

In this case, the Administration for Children and Families is building an alliance of call centers to collaborate on experimental trials to see how best to keep callers on the line long enough to get assistance. Avoiding long periods of silence with callers, and offering an estimate of the waiting time, can help achieve that goal. So can composing the initial message in a way that maximizes the chances that a caller won’t hang up.

HEALTH COMPLIANCE One reason for high health care costs is that patients fail to follow their treatment regimen.

A good way to approach this problem is via a behavioral assessment, identifying obstacles to that compliance. As Sendhil Mullainathan, a Harvard economist, discussed in this space recently, one such obstacle is the co-payment, the patient’s share of a treatment’s cost. He sensibly suggests that for some highly effective treatments, there should be no co-payment at all. That’s a good place to start.

A thorough assessment could also uncover other factors that reduce patients’ adherence to best medical practices. If forgetting to take a medicine is the problem, a variety of interventions can help — from changing the medication’s design (a once-a-day dose is easier to remember than one taken three times a day) to using technology that reminds patients to take their pills.

Similarly, offering phone or text reminders of medical appointments can reduce no-shows and ensure that lab tests are done on time. Information technology makes these mental crutches easy to use, and is the focus of the team’s collaboration with the National Coordinator for Health Information Technology.

All of these examples show that the role of behavioral science in policy isn’t for the government to tell people how to think or act. It is to help them achieve their own goals. Parents want their children to excel, callers to a victims’ hot line want help, and sick people want to get well. Offering aids is like providing an alarm clock: it may help people get to an appointment on time, but no one is forcing them to use it.

Richard H. Thaler is a professor of economics and behavioral science at the Booth School of Business at the University of Chicago. He has informally advised the Obama administration.

The Boss: The DNA of Helping People

I was one of those students whose grades didn’t reflect their abilities. When my guidance counselor asked me what I planned to do after high school, I said I would go to college, of course. She said I wasn’t college material. Instead of being devastated, I thought, “Well, she’s the counselor.”

Senior year I visited a local recruiting station where several military services were represented and decided to sign up for the Marines. I told the recruiter I wanted to work in TV and radio, and he said they could accommodate that. He didn’t tell me what he really had in mind for me. I ended up carrying a radio on my back, calling for medical supplies during exercises in Okinawa. No one told me I’d be saying things like “Tango X-ray Niner” over the airwaves.

During my tour in Japan I became pregnant and married. I was so sick that I was discharged at the end of the first year and served the rest of my enlistment in the Reserve. I immediately enrolled in college for an associate of applied arts degree in journalism at Waubonsee Community College in Aurora, Ill., and worked in public relations for the Marines at the same time.

I graduated in 1987 and started my bachelor’s degree in radio and television at Southern Illinois University. Two years later I completed my military obligation and finished that degree. I then got a master’s degree in human resource development from Webster University in 1993. I’m currently studying for my Ph.D. in values-driven leadership at Benedictine University in Lisle, Ill.

For most of the time, I’d attend school at night and work during the day. My first job after the service was as a recruiter at the Technical College of the Lowcountry, the equivalent of a community college, in Beaufort, S.C. From 1992 to 1994, I worked for DeVry University as a career placement adviser. I was also an adjunct instructor there for eight years, teaching career development, human resources and psychology courses. In 1994, Grady Health System recruited me; I wrote material for their career mobility program.

Every job I took seemed to revolve around helping people making career choices; it’s in my DNA. In 1995 I worked as a consultant, helping organizations manage their employees’ careers, and in 1997 I made this into an Atlanta business, Careers in Transition. I also worked for the Department of Labor as a management and leadership development specialist for a year during that time.

Our clients are mainly federal government agencies. We help them attract, develop and retain employees, and we develop policies and programs for them.

My biggest challenge starting out was how to run my company on a shoestring from my basement. When I could finally move into an office and hire employees, my company took off.

My younger son, Austin, 21, is studying international business at the University of Georgia. In December we traveled to China together. I spoke to a group of human resources professionals there and he studied Mandarin. I’m hoping that when he graduates he’ll get some experience at another company and then join me and help us expand internationally.