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Young people protest in Madrid against Spain’s high youth unemployment rate and government spending cuts.© Susana Vera / Reuters/Reuters

The job situation for Europe's young people is bad – but unemployment rates alone don't tell the whole story.

At more than 50 per cent, the unemployment rates in countries such as Greece and Spain sound like a horribly high figure, but as Toronto-Dominion Bank economist Francis Fong pointed out in a report Tuesday, other metrics paint a picture of a less dire, if still challenging, job market.

The youth unemployment ratio, which is the number of jobless youth as a percentage of the total youth population, is just 15 per cent in Greece and 20 per cent in Spain.

"An unemployment rate of over 50 per cent in Greece and Spain only indicates what is occurring among a relatively small fraction of the total youth population," he said, namely the group that is actively working or seeking work.

It ignores others who are choosing not to participate in the job market, perhaps because they are students, stay-at-home parents, too discouraged to look for work, or any other reason.

The unemployment ratio is important because it removes differences in participation rates between countries. In Spain, 39.5 per cent of young people are working or actively seeking a job, while only 29.3 per cent are in Greece.

The ratio accounts for this difference by including everyone –– job market participants or not – in the equation, Mr. Fong said.

The unemployment rate can make the number of jobless people appear larger because the number of people participating in the labour market is a smaller denominator than the total population.

Still, even smaller-looking youth unemployment ratios have more than doubled in the last four years, Mr. Fong said.

"Ultimately, the number of employed youths in these countries has fallen by a dramatic margin," he said. "While the unemployment ratios for Greece and Spain are much less dramatic, they still present the same bleak picture of the youth labour market."

The unemployment ratio is by no means a substitute for the unemployment rate, Mr. Fong said. Economists actually prefer the unemployment rate because it is a better indication of how well a labour market can absorb excess supply (i.e., job seekers).

But looking at both imperfect measures – the ratio and the rate – provides broader perspective on the job situation in a country. In the case of Greece and Spain, where sky-high unemployment rates for young people have been grabbing headlines, it's worth taking a look at the problem from more than one angle.

In Canada, the unemployment rate for those aged 15 to 24 hit a recent peak of 16 per cent in late-2009 and edged down to 14.3 per cent in July, 2012.

In the U.S., youth unemployment now sits at 16 per cent after recently peaking at 19 per cent.

The unemployment rates for young people in North American are much lower than in Greece or Spain, but attest to a still-serious problem, Mr. Fong said.

More than 214,000 net jobs disappeared among Canadian young people since the recession, and job gains in the 15 to 24 age group during the recovery have been "non-existent," he said.