The European economy shrank by a record 3.8% in the first quarter as business activity from hotels and restaurants to construction and manufacturing was frozen by shutdowns aimed at preventing the spread of Covid-19.
The drop in the 19-country eurozone was the biggest since statistics began in 1995 and sharper than the plunge in the midst of the global financial crisis in the first quarter of 2009 after the bankruptcy of US investment bank Lehman Brothers.
The drop compares to a 4.8% contraction in the US during the first quarter as the shock from the outbreak hits economies around the world.
Unemployment rose only slightly, however, even amid the massive shutdowns that idled everything from florists to factories.
The February jobless figure rose to 7.4% in March from 7.3% in February, statistics agency Eurostat said Thursday.
Millions of workers are being supported by temporary short-hours programmes under which governments pay most of their salaries in return for companies agreeing not to lay people off.
US unemployment rose to 4.4% in March from 3.5% in February, though the eventual picture is likely far worse.
First-time claims for unemployment benefits have skyrocketed in the US as 26 million people applied through the first three weeks of April.
The statistics in Europe likely understate the depth of the fall since shutdown measures were mostly put in place only in March, the last of the three months in the quarter.
Figures from France suggested the extent of the downturn.
The economy shrank 5.8%, the most since the country’s statistics agency began keeping the figures in 1949.
The drop was particularly pronounced in services that involve face to face interaction, such as hotels and restaurants, retail stores, transportation and construction.
READ MORE: Coronavirus: Glasgow biotech firm develops potential Covid-19 treatment
The figures come ahead of a meeting of the European Central Bank, which analysts think may expand its bond purchase programme that supports governments and borrowing markets.
That decision may not come on Thursday but markets are awaiting an assessment from bank head Christine Lagarde.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here