Sunday 22 April 2018

Spanish jobless falls 100,000 as tourist season begins

Spanish Prime Minister Mariano Rajoy
Spanish Prime Minister Mariano Rajoy

Sonya Dowsett

SPAIN'S number of registered unemployed fell last month but seasonal hires were largely responsible, knocking government optimism that the drop heralded a turnaround for the country's crippled economy.

With chronically high unemployment a source of rising social unrest and the greatest barrier to a return to growth, Prime Minister Mariano Rajoy had previewed yesterday's data, saying it would be "clearly encouraging".

It showed the registered jobless total fell by 1.97pc or more than 98,000 people, leaving 4.89 million out of work.

The data marked a record drop for May and was "the best we've seen since the crisis began", Industry Minister Jose Manuel Soria said.

But it excludes the long-term unemployed, and once seasonal factors such as holiday hires by hotels and farmers were added in, the drop was just 265 people.

"To say this data supports the onset of a recovery in the labour market is a bridge too far in my view," said Martin Van Vliet, economist at ING.

"It is not necessarily a recovery driven by healthy job growth. It could also be influenced by the recent trend of young people moving abroad in search of work."

At 27pc in the first quarter, Spain's unemployment rate is the highest in the European Union after Greece, and even if the country pulls out of recession next year as economists forecast, job creation could lag for some time longer.

The rate has risen steadily along with the budget cuts and labour market reforms that Mr Rajoy's government has introduced, fuelling public anger and sparking protests in major cities.

The link between austerity and lengthening dole queues has also created a dilemma for Europe's policymakers, and Germany's finance minister warned last week that failure to cut youth unemployment in particular could tear the continent apart.

Spain's youth unemployment rate has soared well beyond 50pc, and many young Spaniards have responded by emigrating in search of jobs.

(Reuters)

Irish Independent

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