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Spanish jobless rate drops in five-month first

05 January 2011 01:45 (UTC +04:00)

Baku-APA. The number of people unemployed in Spain, which has the highest jobless rate in the European Union, fell for the first time for five months in December, the labour ministry said on Tuesday, APA reports quoting news.yahoo.com website.
There were 4.1 million people registered as jobless last month, down 10,221 or 0.25 percent from November, the biggest decline for the month of December since 2000, it said in a statement.
But compared with the total 12 months ago the figure was still up 4.50 percent, or 176,470.
"December is is normally a weak month, if unemployment lowered in December it is a good jobless figure," Prime Minister Jose Luis Rodriguez Zapatero said in an interview with Onda Cero radio.
The government does not provide a jobless rate, but the national statistics institute, which uses a different calculation method from the labour ministry, said in October that the rate had dropped to 19.79 percent in the third quarter of 2010 from 20.09 percent in the second.
It was the first drop in the unemployment rate since it dipped to 7.95 percent in second quarter of 2007, its lowest level since the country returned to democracy following the death of dictator Francisco Franco in 1975.
The institute will publish fourth quarter unemployment figures on January 28.
Last month Zapatero’s Socialist government announced it was scrapping a 426-euro (568-dollar) per month subsidy for the long-term unemployed as part of austerity measures to slash the public deficit and ease fears that it will need an EU bailout like Greece and Ireland.
The Spanish economy, the EU’s fifth biggest, slumped into recession during the second half of 2008 as the global financial meltdown compounded the collapse of a labour-intensive construction boom
It emerged with tepid growth of just 0.1 percent in the first quarter of 2010 and 0.2 percent in the second but then stalled with zero growth in the third.
Zapatero said the fourth quarter would record positive growth which would pick up steam in 2011 but he warned that job creation this year would be "far from what we need and desire. It will be slow and progressive."
The government forecasts a 0.3-percent drop in growth this year will be followed by an expansion of 1.3 percent in 2011.
The prime minister said 70 percent of the two million jobs which were lost in Spain since the start of the economic downturn were directly or indirectly related to the construction sector.
"This indicates the degree of the imbalance which our economy had," he said.
Last year the government introduced a hotly contested labour market reform that cut the country’s high cost of firing workers and gave companies more flexibility to reduce working hours and staff levels in economic downturns -- changes that he argued would boost job creation.
Last month European Central Bank President Jean-Claude Trichet said it was "extremely important to deepen the reform of the labour market" during a visit to Madrid.
In October the government raised its forecast for the jobless rate for 2011 to 19.3 percent from a previous estimate of 18.9 percent.
It predicts the jobless rate will dip to 17.5 percent in 2012 and 16.2 percent in 2013.
Spaniards see unemployment as Spain’s biggest problem and one in two, or 49.8 percent, fear the jobless situation will get worse, a poll published by the CIS research firm on Tuesday showed.