15,000 Jobs Are Latest Toll of Austerity in Greece ; Cuts in State Payroll Ordered as Debt Rises to Almost 160% of G.D.P

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The cuts are part of new austerity measures that Athens must agree on to secure new debt agreements and rescue funds from international lenders.

Greece will cut 15,000 state jobs this year, the government announced Monday, part of new austerity measures it must agree on to secure new debt agreements and rescue funds from international lenders.

Athens is racing to push through economic changes that will persuade its lenders to release EUR 130 billion, or $170.5 billion, in new bailout funds to avoid defaulting on its bond payments in March.

The talks, which focus on bringing Greece's debt burden down to a manageable level, are taking place against a backdrop of a deteriorating Greek economy that is causing the country's debt burden to rise as austerity measures cut into the potential for economic growth.

Greece's debt rose to 159.1 percent of gross domestic product in the third quarter of 2011 from 138.8 percent a year earlier, according to data released Monday by Eurostat, the European Union statistical agency.

Public-sector layoffs have long been a taboo subject in Greece, since the Constitution protects state workers from being fired. So any cuts need to happen through attrition or eliminating positions.

The Greek administrative reform minister, Dimitris Reppas, announced the job cuts but did not provide details on how they would be carried out.

Anticipating a new barrage of austerity measures, including wage cuts in the private sector, the country's two main labor unions called a 24-hour general strike for Tuesday. The strike is expected to disrupt transport and other public services. Three separate protest rallies have been planned for central Athens alone.

Some economists argue that the dislocation in Greece shows that austerity is precisely the wrong medicine for the struggling economy. Shrinking the G.D.P. side of the equation makes it harder to bring down Greece's debt ratio to a more sustainable level, as the country has pledged to do, and adds pressure for additional taxes and spending cuts.

Two years of spending cutbacks have weighed on employment, with the jobless rate at 19 percent, and have lowered government tax revenue. The economy is expected to contract 6 percent in 2011, the International Monetary Fund has estimated.

The European Union has forecast Greece's debt ratio for 2011 at 162.8 percent of G.D. …