The definition of unemployment is restrictive, excluding many people who are not in work. Labour market slack, by capturing additional groups of people without jobs, provides a more comprehensive picture than unemployment alone.
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As of the second quarter of 2025, 13.3 million people aged 15 to 74 in the EU are officially unemployed. However, this figure rises to 26.8 million when including so-called ‘hidden unemployment’, since the standard definition of employment is very restrictive. It excludes three key groups:
people available to work but not actively seeking employment
underemployed people working part-time
people seeking work but not immediately available
According to Eurostat, these groups, together with the unemployed, make up so-called 'labour market slack'. But in which European countries is the workforce underutilised?
In the EU, labour market slack stood at 11.7% in the second quarter of 2025, according to Eurostat. This figure combines 5.8% unemployment, 2.6% of people available to work but not actively seeking employment, 2.4% underemployment, and 0.9% of those seeking work but not immediately available.
Across 33 European countries, labour market slack ranges from 5.1% in Poland to 25.8% in Turkey, which stands out as an outlier. The two Nordic countries, Finland (19.5%) and Sweden (18.8%), rank among the top three, closely followed by Spain (18.6%).
This ‘hidden unemployment’ is also high in Bosnia and Herzegovina (17.1%), France (15.4%) and Italy (15%).
Poland (5.1%), Slovenia (5.3%), Malta (5.4%), and Bulgaria (5.5%) record the lowest labour market slack rates in Europe, all falling below 6%.
Among the EU’s four largest economies, Germany has the lowest labour market slack at 7.8%—the only one below the EU average. The other three—France, Italy, and Spain—are in the top cluster, with rates at or above 15%.
The total of the four variables that make up labour market slack in the chart may differ slightly across countries in the Eurostat dataset due to rounding, and in some cases because of seasonal adjustments.
Drivers of slack differences across countries
Dorothea Schmidt-Klau, chief of employment, labour markets and youth branch at the ILO in Geneva, explained that four main factors drive the significant differences in labour market slack across European countries.
One is persistently high unemployment rates that discourage people from looking for jobs. Often, they don’t trust the system to help them find suitable work.
“Decades of high unemployment have created a sense that searching is futile. When people believe there are few chances to find suitable jobs, they often stop looking, even if they remain willing and able to take up work,” she said.
Another factor is insufficient support systems, such as limited family care options and oppressive social norms.
“This explains a large part of the difference in terms of labour force participation between Northern European countries and Southern European countries,” she said.
The next possible reason is a lack of high-quality jobs and posts that match the aspirations and needs of those looking for work.
On top of this, skills mismatches can remain a barrier even for workers who invest in their education and training.
“They had to find out too late that their skills do not match what enterprises are looking for, a strong reason to give up hope,” said Schmidt-Klau.
Available to work but not actively seeking employment: Why?
After unemployed persons, the second largest contributor to labour market slack in the EU is those who are available to work but not actively seeking employment. This group shows significant variation across countries, ranging from just 0.3% in Czechia to 12.3% in Turkey.
Turkey is the only country where the share of people available to work but not seeking exceeds the unemployment rate (8.6%).
This rate is also relatively high in Italy (6.6%) and Sweden (4.4%). In contrast, it is only 2.8% in Spain, despite Spain having the highest unemployment rate in the EU.
Underemployed persons working part-time
Higher rates of underemployed persons working part-time also contribute significantly to overall labour market slack in several countries. The Netherlands (5.1%), Finland (4.8%), and Ireland (4.7%) form the top three, while the rate is also above 4% in Switzerland, Turkey, and Spain.
A third of slack from unemployment in four countries
Unemployment accounts for roughly one-third of total labour market slack in four countries: the Netherlands and Turkey (both 33%), and Ireland and Switzerland (36%). This suggests that there are very large numbers of people without work beyond those captured by unemployment rates, underlining the significance of looking at slack figures.
