BRUSSELS: Europe needs to come up with a plan within weeks to end the “nightmare” of mounting youth unemployment, Italy's new premier Enrico Letta and European Commission chief Jose Manuel Barroso said Thursday.

Winding up his first European tour since being sworn in on Sunday, Letta urged the European Union to offer “concrete” measures to its recession-hit citizens and jobless youths in order to revive hope in the EU's future.

Barroso, often slammed for pushing an austerity agenda that is costing millions of jobs and undermining support for the European project, responded by urging the union's 27 leaders to come up with a package against youth unemployment at a June 27-28 summit.

“We must revive hope, especially for young people,” Barroso said. “We cannot wait for long, we are all aware this is urgent.”

The pair spoke at a brief news conference held shortly before the European Central Bank decided whether to cut interest rates to a new low as calls mount across the 17-nation eurozone for a focus on growth rather than austerity.

In talks in Berlin and Paris, the new leader of the eurozone's third largest economy hammered home his message that Italy was “dying from austerity alone” and must kickstart an economy that shrank seven per cent in the five years up to 2012 and is forecast to contract further this year.

Letta stressed too that Brussels must show it could deliver by dealing with joblessness that threatens to leave behind a lost generation of European youth.

“Youth unemployment, that is the real nightmare of my country and the EU,” he said.

“It is important for us to have in June some important signals for European citizens in terms of recovering hope and confidence,” Letta added in reference to the June summit.

Letta, who was sworn in after a two-month political impasse, on Monday announced a series of measures worth around 10 billion euros ($13 billion) to spur growth but pledged in Brussels to “maintain the engagements of previous governments” with the Commission to meet eurozone debt and deficit targets.

Barroso cautioned that while sharing Letta's view of the urgent need for growth and job-enhancing measures “we are also both firmly convinced that you can only build lasting growth and competitiveness on the back of healthy public finances.”

“Every euro spent on debt is a euro not invested in jobs,” he said. But the Commission president acknowledged that a 120-billion-euro EU growth pact was proving “below our expectations” and called on leaders of the bloc to sign up to “a more ambitious plan to fight youth unemployment”.

New data this week showing unemployment at a record high of 12.1 per cent, or 19 million people, out of work in the 17-nation eurozone, offered frightening new figures on youth unemployment.

One out of four under-25s was on the dole in the EU in March but almost two in three in Greece and Spain.

The Eurostat statistics agency said that 24 percent of under-25s were jobless in the eurozone and 23.5 per cent in the 27-nation EU against 22.5 per cent and 22.6 per cent a year earlier, respectively.

In Greece the figure soared to a whopping 59.1 per cent in January, the latest available figure, and in March hit 55.9 per cent in Spain, 38.4 per cent in Italy and 38.3 per cent in Portugal.

“Youth unemployment has potentially disastrous consequences, especially if it prolongs, as young people can be cut off not only from the labour market but from society as a whole,” the EU's social affairs and employment commissioner Laszlo Andor said this week.

“EU institutions and governments, business and social partners at all levels need to do all they can to avoid a 'lost generation'”.