Italy’s unemployment rate rose to the highest level since June 2015, as the country struggles to regain a solid economic footing. The jobless rate was 11.9% in November, up from a revised 11.8% the month before, Italian statistics agency Istat reported. Youth unemployment rose to 39.4%, the highest since October 2015.

The November unemployment rate for the 19-nation euro area was 9.8%, the European Union’s statistics office in Luxembourg reported. Istat said that businesses foresee an employment boost for Italy’s manufacturing industry, with a decrease in trade, construction and services.

However, the amount of Italian bad loans shrank by nearly €2bn in November 2016 compared with the same month of the previous year, the largest drop in eight years. Italian banks’ equities lost about 47% of their peak value in 2015, but have recovered since the state announced its rescue plan of Monte dei Paschi di Siena, Italy’s oldest bank.

But ‘brick-related’ bad loans continue to be a drag. The property sector added €3.6bn of bad debt in November 2016 compared with the previous year, corresponding to an 18% increase. All brick-related bad loans (construction and property) are now responsible for over 43% of the total debt in Italy, up from 24% in 2010.

Nomisma forecasts Italian property prices in the 13 largest cities to fall by 1% this year, to be flat in 2018 and to rise by 1% in 2019.