07:13 AM EDT, 10/02/2024 (MT Newswires) -- The eurozone unemployment rate stood at 6.4% in August, stable compared to July and still at a historic low, said ING after Wednesday's data release.

The unemployment rate remains at the lowest level recorded since the eurozone began in 1999, wrote the bank in a note. The low rate remains remarkable given the sluggish economic environment that the eurozone has been in since late 2022.

However, labor demand remains high despite a weak economic environment. That results in "worrisome" productivity developments, but also boosts household income growth and confidence in the short-term, stated ING.

Job vacancy rates in the eurozone have fallen as new vacancies drop. The rate currently stands at 2.6%, down from 2.9% in Q1. But despite vacancies coming down, the vacancy rate remains elevated and businesses still report labor shortages as a top concern.

That means that unemployment remains low despite economic sluggishness, pointed out the bank.

The trend is towards further loosening in the job market though. With economic growth falling short, an increase in bankruptcies, and a decline in job vacancies, a slight rise in unemployment is likely to become "noticeable," added ING. However, given the still substantial demand for labor, the bank expects that the upward pressure on unemployment will remain limited in the coming months.