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GDP up by 2.2% and employment up by 0.7% in the euro area

In the second quarter of 2021, seasonally adjusted GDP increased by 2.2% in the euro area and by 2.1% in the EU compared with the previous quarter, according to an estimate published by Eurostat, the statistical office of the European Union. In the first quarter of 2021, GDP had declined by 0.3% in the euro area and 0.1% in the EU.

Compared with the same quarter of the previous year, seasonally adjusted GDP increased by 14.3% in the euro area and by 13.8% in the EU in the second quarter of 2021, after -1.2% in both zones in the previous quarter.
During the second quarter of 2021, GDP in the United States increased by 1.6% compared with the previous quarter (after +1.5% in the first quarter of 2021). Compared with the same quarter of the previous year, GDP increased by 12.2% (after +0.5% in the previous quarter).

GDP growth by Member State

Ireland (+6.3%) recorded the sharpest increase of GDP compared to the previous quarter, followed by Portugal (+4.9%), Latvia (+4.4%) and Estonia (+4.3%). Declines were observed in Malta (-0.5%) and Croatia (-0.2%).

GDP components and contributions to growth

During the second quarter of 2021, household final consumption expenditure increased by 3.7% in the euro area and by 3.5% in the EU (after -2.1% in the euro area and -1.7% in the EU in the previous quarter). Government final consumption expenditure increased by 1.2% in both zones (after -0.5% both in the previous quarter). Gross fixed capital formation increased by 1.1% in the euro area and by 1.0% in the EU (after -0.2% and +0.3% respectively). Exports increased by 2.2% in the euro area and by 1.8% the EU (after +0.7% in both areas). Imports increased by 2.3% in the euro area and by 2.2% in the EU (after +0.4% and +0.6%).

Household final consumption expenditure had strong positive contributions to GDP growth in both the euro area and the EU (+1.9 and +1.7 percentage points – pp, respectively). The contributions from government final expenditure (+0.3 pp in both zones) and gross fixed capital formation (+0.2 pp in both zones) were also positive. The contribution from the external balance was close to neutral for both zones, while the contribution from changes in inventories was slightly negative for the euro area and neutral for the EU.

GDP levels in the euro area and EU

Based on seasonally adjusted figures, GDP volumes were 2.5% and 2.2% below their highest level of the fourth quarter 2019 for the euro area and EU. For the United States, GDP was 0.8% higher than the level of the fourth quarter 2019.

Employment growth in the euro area and EU

The number of employed persons increased by 0.7% in both the euro area and in the EU in the second quarter of
2021, compared with the previous quarter. In the first quarter of 2021, employment had decreased by 0.2% in both
the euro area and the EU.

Hours worked increased by 2.7% in the euro area and by 2.4% in the EU in the second quarter of 2021, compared with the previous quarter. Compared with the same quarter of the previous year the increases were 17.0% in the euro area and 14.7% in the EU (see annex table on employment in hours worked).

These data provide a picture of labour input consistent with the output and income measure of national accounts.

Employment growth in Member States

In the second quarter of 2021, Latvia (+5.7%), Greece (+2.8%), Denmark and Portugal (both +1.9%) recorded the highest growth of employment in persons compared with the previous quarter. Decreases were observed in Estonia (-1.1%) and Spain (-0.9%).

Employment levels in the euro area and EU

Based on seasonally adjusted figures, Eurostat estimates that in the second quarter of 2021, 207.5 million people were employed in the EU, of which 159.0 million were in the euro area.

In relation to the COVID-19 pandemic, employment in persons was 2.1 million in the euro area and 2.0 million in the EU below the level of the fourth quarter of 2019.

Evolution of labour productivity in the euro area and EU

The combination of GDP and employment data allows an estimation of labour productivity. The analysis of growth compared to the same quarter of the previous year shows that productivity growth (based on employed persons) fluctuated around 1% for both zones between 2013 and 2018.

In relation to the COVID-19 pandemic, productivity based on persons increased compared to the same quarter of the previous year with 12.2% for the euro area and 11.6% for the EU.

Based on hours worked, productivity compared to the same quarter of the previous year decreased by 1.5% for the euro area and increased by 0.3% for the EU.

Geographical information

The euro area (EA19) includes Belgium, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Austria, Portugal, Slovenia, Slovakia and Finland. The European Union (EU27) includes Belgium, Bulgaria, Czechia, Denmark, Germany, Estonia, Ireland, Greece, Spain, France, Croatia, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, the Netherlands, Austria, Poland, Portugal, Romania, Slovenia, Slovakia, Finland and Sweden.

Methods and definitions

European quarterly national accounts are compiled in accordance with the European System of Accounts 2010 (ESA 2010). They include key policy indicators on GDP and employment. Gross domestic product (GDP) at market prices measures the production activity of resident producer units. Growth rates are based on chain-linked volumes.

Employment covers employees and self-employed working in resident production units (domestic concept). Employment flashestimates are limited to total employment in persons, but regular estimates also cover hours worked and industry breakdowns. Labour productivity is compiled as the ratio of economic output (GDP, chain-linked volumes with reference year 2010) to labour input (total employment measured in persons or hours worked, for all industries, according to the domestic concept).

Release schedule of main aggregates

This news release presents estimates for euro area and EU GDP and employment aggregates based on national accounts transmission from almost all Member States due after t+2 months.

A further estimation is done at around t+110 days after some countries transmit updated estimates. To increase the timeliness of key indicators, Eurostat also publishes flash estimates for GDP (after around 30 and 45 days) and employment (after around 45 days). Their compilation is based on estimates provided by most EU Member States on a voluntary basis.

Revisions and timetable

The reliability of GDP and employment flash estimates was tested by dedicated working groups and revisions are continuously monitored. Further information can be found on Eurostat website. The method used for compilation of European GDP and employment estimates is the same as for previous releases.

With these estimates, euro area and EU employment and GDP figures for earlier quarters are revised. Flash estimates of employment and GDP growth were published in News Release 94/2021 issued on 17 August 2021. They were based on a more limited data set than the one used for the present News Release and additionally, on preliminary estimates which have now been revised by some Member States. Revisions for the last quarter are highlighted in bold in the table below:


Source: Eurostat

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