There was a real improvement in the employment momentum in 2016 in the Euro Area. Employment growth was 1.3%, the best figure since 2007.
This dynamics will continue at least during the first half of 2017. The Markit sub-Index on employment suggests a real improvement in months to come.
Since 2014 the employment is upward trending and a positive profile. In fact it is since the end of austerity policies

The relationship between growth and employment is stable since 1996. 2009 was a year of strong adjustment after the Lehman moment. 2012 and 2013 show the impact of austerity policies. Governments choice has had a strong negative effect on growth and on employment.
In 2016 the dot is above the trend (in red). This shows a catch up on employment in Spain, but also a strong dynamics in Germany and a recovery in France.
The relationship suggests that there is a need for higher growth in order to have a stronger momentum on employment. It goes through investment and specifically through public investment in order to create incentives on the private sector.
The current employment dynamics creates a virtuous cycle as it leads to higher incomes feeding internal demand. This is this virtuous profile that will push growth to 2% in 2017.