Spanish Unemployment Rate Inches Up

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The FINANCIAL — Spain’s unemployment rate edged higher in the first quarter from the previous three months, as an accelerating economy failed to offset seasonal job losses, according to Nasdaq.

Spain’s INE national statistics bureau said on April 23 the rate stood at 23.8% compared with 23.7% in the fourth quarter, driven by the loss of 114,300 jobs in the span.

Still, a close look at the data indicates the country’s recovery from a seven-year crisis continues apace and should lead to a slide in the rate in coming quarters.

 INE said the job loss in the period was the smallest in any first quarter-typically a poor one for country’s large and jobs-intensive tourism industry-since the country’s property bubble burst in 2008.

In addition, the number of people in Spain without jobs fell by 13,100, the largest drop in any January-March quarter since 2005, to 5.44 million. The number of Spanish households with all active adults unemployed, seen by many as a key social indicator, fell by a whopping 9.4% over the last 12 months, the steepest reduction since 2006.

Despite a recent slide from all-time high levels, Spain’s unemployment rate is the second highest in the European Union after Greece, which stood at 26% of the workforce at the end of 2014.

During the early stage of the European crisis, Spain led the EU in unemployment, with Greece’s unemployment rate becoming the highest only in mid-2012. Spain’s unemployment rate still kept rising, and peaked at 26.9% in the first quarter of 2014, just as the economy was giving its first signs of recovery.

This jump in unemployment was largely driven by the loss of just over three million jobs between the heyday of the country’s property boom in 2007 and 2013, with two-thirds of those corresponding to the real estate and construction sector.

A timid recovery in construction started last year, with the addition of 40,000 new jobs, and continued in the first quarter, as 30,300 new jobs were recorded in the industry.

This is particularly good news for Spain’s poorest regions, mostly in the south of the country and lacking in manufacturing. The property boom there led to quick fortunes and highly-paid jobs for low-skilled workers, and the property bust drove unemployment through the roof.

To this day, the unemployment rate in northern regions such as Navarre and the Basque Country is less than half that in Andalusia, the region with the highest unemployment rate in all of Europe.

Andalusia’s unemployment rate fell in the first quarter to 33.6% from 34.8% in the fourth quarter, as the region was one of only two that posted net job creation in January-March. Navarre had the lowest unemployment rate of Spain, at 15.7%, in the first quarter.

Just Wednesday, the EU’s statistics agency Eurostat said all five European regions with the highest unemployment rate are in Spain, with Melilla, a Spanish enclave in northern Africa, also in the top ten.

Four Greek regions make up the rest of the top ten, but differences between regions in Greece are much less prominent, and the split north-south not so obvious. One of those four, Dytiki Ellada, is in the center-west, while two are in the north (Kentriki Makedonia and Dytiki Makedonia) and the fourth is the region where the capital city, Athens, is located.

 

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