ROME, June 30 (Reuters) - Italy's unemployment rate fell to 8.1%in May from 8.3% April, hitting its lowest level for two years, but the decline was due to people withdrawing from the labour market as 49,000 jobs were lost in the month, data showed.
A Reuters survey of analysts had forecast a May jobless rate of 8.4%. National statistics bureau ISTAT slightly revised down the April rate from an originally reported 8.4%.
Despite the latest marked downturn in jobs, in the three months to May employment was still up by 136,000 or 0.6%, compared with the December-to-February period, ISTAT said.
May's 8.1% unemployment rate was the lowest since April 2020, at the height of the first wave of Italy's COVID-19 crisis. That decline in job-seekers was also due to people withdrawing from the labour market because employment was not available.
Compared with May 2021, employment was up by around 463,000, or 2.1%, ISTAT said.
More than half the jobs created in the last year have been temporary contracts. The number of temporary workers in Italy now stands above 3.17 million, the highest number since 1977, the statistics bureau said.
In May the youth unemployment rate, measuring job-seekers between 15 and 24 years old, fell to 20.5% from 22.6% the month before.
Italy's overall employment rate, one of the lowest in the euro zone, dipped in May to 59.8% from 59.9% in April.
Italy's economic prospects have dimmed due to the fallout from Russia's invasion of Ukraine, and the economy grew by just 0.1% in the first quarter from the previous three months.
Prime Minister Mario Draghi's government revised down Italy's full-year gross domestic product forecast in April to 3.1% from a 4.7% projection made last September.
The latest forecast is considered optimistic by most independent bodies.
ISTAT gave the following data:
MAY APRIL MARCH FEB
JOBLESS RATE 8.1 8.3r 8.3r 8.5r
YOUTH UNEMPLOYMENT RATE (15-24) 20.5 22.6r 24.1r 23.7r
EMPLOYMENT RATE (15-64) 59.8 59.9 59.9 59.6
r=revised