This paper investigates the effects of the Great Recession on unemployment rates in Europe. I focus on the effects of particular labor markets policies (such as minimum wage, employment protection policies, and labor income tax rate) as well as other macroeconomic policies (such as monetary and fiscal policy). It is debated in the literature as to whether unemployment patterns can be explained by long term shifts in labor market institutions or by interactions between institutions and shocks. In this paper, I frame the question in the context of the the Great Recession. I use data from OECD for labor markets and macro policies. As labor market institutional variables, I consider minimum wage, unemployment benefits, employment protection legislation, union density and active labor market policies. As macroeconomic policies, I consider budget deficits, monetary base changes and interest rates.