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* Rates up in Cyprus, Italy, Netherlands, Portugal, Spain; Falls in Austria, Ireland, Slovakia, Slovenia *
Unemployment in the euro zone rose to a 15-year high of 10.9% in March, driven by lay-offs in Italy and Spain, and economists said worse was to come as the impact of the debt crisis extracts an ever greater toll.
The jobless rate in the 17 nations using the single currency increased by a tenth of a percentage point from February, as expected by economists polled by Reuters, the EU's statistics office Eurostat reported on Wednesday.
The figures translate into 17.4 million people unemployed in the euro zone, and 24.8 million out of work across the 27-nation EU, where the unemployment rate held steady at 10.2%.
The last time unemployment was so high was in February, March and April 1997, before the euro was introduced. It has never risen above that level in data stretching back to the start of 1995, but economists forecast it would soon do so.
"It now looks odds-on that the euro zone unemployment rate will move appreciably above 11.0% over the coming months with an ever growing danger that it will reach 11.5%," said Howard Archer, economist at IHS Global Insight.
The euro zone jobless total has now risen every one of the past 11 months, leaving the number of out work equal to the entire population of the Netherlands.
A number of euro zone member states are in or on the verge of falling back into recession as the debt crisis that has spread over the past two years freezes the wheels of the economy and stalls the credit businesses rely on to finance growth.
Some European countries are threatened by a negative spiral of austerity measures, forced on governments by the debt crisis, which undermines consumer and business confidence, hits growth and requires ever deeper budget cuts.
SPAIN IN RECESSION
Spain sank back into recession in the first quarter, according to data issued on Monday. Its unemployment rate hit 24.1% in March, a level not seen in euro zone data stretching back to 1986.
Within the euro zone, unemployment also rose in Cyprus (to 10% from 9.8% in February), Italy, the Netherlands and Portugal. It was unchanged in Belgium, Finland, France, Germany, Luxembourg and Malta and fell in Austria, Ireland, Slovakia and Slovenia. There was no data for Estonia or Greece.
The EU and euro zone labour market contrasts with that of the United States, where the jobless rate has fallen to 8.2%, from 9.1% in mid-2011.
"The figures clearly highlight the diverging economic paths of the euro zone and the United States, where unemployment is falling. In fact, the gap between euro zone and U.S. unemployment rates hasn't been this wide since the end of 2007," said ING economist Martin van Vliet.
He added the figures were likely to prompt a debate about a 'growth pact' for Europe.
The European Commission's spokesman on employment, Jonathan Todd, described the latest jobless figures as very worrying.
"They confirm the urgency of creating more dynamic labour markets and the urgency of putting in place concrete measures to support the creation not only of more jobs, but better and more sustainable jobs," he said.
"The Commission is… working with member states to achieve job-rich growth measures."
The Commission plans to issue country-specific recommendations at the end of May aimed at boosting employment based on programmes submitted this week by member states.
