Unemployment jumped to 17.7 percent in the third quarter from 16.3 percent in the previous three-month period, the Hellenic Statistical Service (Elstat) said – the highest quarterly unemployment rate recorded since the series started in 1998.
Construction companies, manufacturers, retailers and wholesalers have been particularly hard hit, shedding nearly 180,000 jobs in the last year alone as tax hikes and spending cuts have weighed on an economy facing a fifth year of recession in 2012.
An IMF report this week projected jobless numbers would keep rising over the next two years to peak at 19.5 percent in 2013, versus 7.7 percent in 2008, before the explosion of the debt crisis that spread turmoil across the eurozone.
Most expect their economic situation to worsen next year as the government applies more belt-tightening to slash deficits, an opinion poll showed earlier this month.
The IMF said on Wednesday that the government needed to step up the pace of reforms and to look at "taboos" that could include laying off more state workers.
"Public support for austerity and reforms will be difficult to keep with the economy in a deep recession and unemployment at a record high," said Diego Iscaro, at IHS Global Insight.
"Support for more drastic actions – ie a ‘coercive’ default – may go up, but we still believe Greece will remain in the eurozone, although the risks of an exit will increase the longer the economy remains in the doldrums."
The rising numbers of shops and businesses firing staff or shutting down makes it harder for the government to collect taxes and plug the budget gap, raising the risk that even further belt-tightening may be necessary.
Unemployment will slowly start decreasing from 2014 but will still stand at just over 13 percent in 2020, the IMF said in a report published on Tuesday, raising the prospect of many more years of pain.
Elstat has already published monthly unemployment figures through to September. The quarterly data are based on a bigger survey sample and provide detailed data for each sector of the economy.
The number of unemployed reached 878,266 in the third quarter – more than 40 percent higher than a year ago.
The country's unemployment rate is much higher than the eurozone average of around 10 percent in the three months to September. But it is lower than in Spain, which registered a 21.5 percent unemployment rate in the third quarter.
"Austerity alone will not rescue Greece from its dire position," Iscaro said. "If Greece wants to stay in the eurozone, it will need to make its economy more competitive." (Reuters)
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