Financial Times: Europeans' <http://www.ft.com/cms/s/0706b982-af3e-11db-a446-0000779e2340.html> low expectations of eurozone prove widespread
By Ralph Atkins in Frankfurt Published: January 29 2007 02:00 | Last updated: January 29 2007 02:00 The eurozone economy may be growing robustly, but its citizens appear not to expect significant financial gains as a result. They give scant credit to the eight-year-old euro for improving national performances, an FT/Harris poll shows. The sceptical views of citizens in the main European economies - Germany, France, Spain and Italy, which use the euro currency, and the UK - may do little to cheer European Union policymakers. More than half of adults surveyed believed that the euro had harmed their national economies, with scepticism especially high in France and Italy. But the results at least offer the European Central Bank comfort on one front: expectations of inflation-beating wage rises are not widespread. Just under half of adults in employment across the countries surveyed expect to receive a pay rise this year. Of those expecting a pay rise, roughly 23 per cent expect a rise above the rate of inflation but 24 per cent expect an increase below the rate. Workers in Britain and Spain - where inflation rates are the highest among the largest European Union countries - are most likely to expect a pay rise. The French and Germans are more likely to expect a pay rise above the inflation rate. Fears about inflationary pressures from the labour market are a main reason why the ECB has signalled further interest rate rises are likely. But Europeans' low expectations about their own finances could also damp consumer spending, lowering overall growth. When asked how they expected their finances to fare in 2007, just 26 per cent expect to be better off at the end of the year. Some 23 per cent of the adults surveyed expect to be worse off and 43 per cent expect no change. The British and Spanish were significantly more confident that their finances would improve, with 31 per cent and 38 per cent respectively expecting to end the year better off. Scepticism about the effects of globalisation is also evident. A clear majority of European adults believed an influx of migrant workers has reduced wages. That is particularly true in Germany, where 69 per cent of adults think that wages have fallen as a result and 33 per cent describe the decline as "substantial". Unsurprisingly, low income families think the effects have been the worst. Almost a quarter of adults in full or part-time employment are concerned that they may lose their jobsthis year. Italians and the Spanish are the most concerned. The entry of Bulgaria and Romania this year into the European Union also failed to find much support; some 45 per cent of adults regarded the move as a negative. In Germany, almost 60 per cent had negative feelings about the entry of the new members. <http://www.ft.com/servicestools/help/copyright> Copyright The Financial Times Limited 2007 ---------------------------- Vali "Noble blood is an accident of fortune; noble actions are the chief mark of greatness." (Carlo Goldoni) "When the power of love overcomes the love of power, the world will know peace." (Jimi Hendrix)
