Spain’s unemployment rate leaps to record high

Owners of furnished properties on the Continent could get up to five years of tax back under a change in the rules

More than four million Spanish people are out of work. According to the country’s National Statistics Institute a record high figure of 17.4 per cent were unemployed in the first quarter of the year.

Unemployment leapt from 13.9 per cent in the fourth quarter of 2008, the biggest quarterly jump since 1976. Joblessness in Spain has almost doubled in a year.

The Bank of Spain had previously forecast that unemployment would not surpass 17.1 per cent for the year. Alarmingly, 1,068,400 families have every member out of work.

And as the dole queues lengthen, labour unrest is growing. Two hundred pickets yesterday picketed a shipyard in the Basque country to protest at the employment of cheap Romanian and Portuguese workers that is threatening the jobs of 1,100 local workers.

The protest echoes demonstrations in Britain in February in which oil workers at the Lindsey oil refinery protested against the employment of foreign workers.

Signs of growing desperation are not hard to find. Two developers turned to crime as their construction companies foundered. One staged a series of bank robberies in Catalonia. Another kidnapped his bank manager in Malaga and demanded €50,000 (£45,000) to pay his debts.

Most out-of-work Spaniards adopt more conventional methods to find jobs. Raquel Riojas, 26, from Malaga, spends ten hours a day surfing internet jobsites.

She said: “The last time I was looking for a job, in 2008, I had two interviews a day. Now, in two months, I have only had three.”

The surge in unemployment comes two months before crucial European elections and the popularity of Spain’s Socialist Government is waning, according to recent polls.

The Government has launched a €70 billion fiscal stimulus programme to counteract the collapse of the construction sector and has toughened controls on immigration to slow growth of the workforce.

Elena Salgado, the new Economy Minister, said: “These figures are bad and they’re worse than expected.” However, the minister said that she was hopeful that the effect of government spending on infrastructure schemes would begin to be felt soon.

Dominic Bryant, an economist with BNP Paribas, said: “The momentum is clearly there for something well above 20 per cent, it’s odds on, really. My forecast is that it gets to something around about 23 per cent.”

Graham Keeley in Barcelona
April 25, 2009

Source: The Times