Spanish Unemployment Rate Jumps the Most in 15 Years

The unemployment rate in Spain, once an engine of European job creation, jumped the most in 15 years in the first quarter to a three-year high as the building market contracted, Bloomberg reported.

The jobless rate rose to 9.6 percent from 8.6 percent in the fourth quarter, the Madrid-based National Statistics Office said on its Web site. The last time the rate increased that much was in the first quarter of 1993, when Spain most recently slipped into recession. The number of unemployed rose 13 percent, or 246,000, to 2.1 million people, the report said.

``This is brutal,'' said Jose Luis Martinez, a strategist at Citigroup Inc. in Madrid. ``That this can happen while the economy is still growing around 2.5 percent is really worrying.''

The global credit shortage is exacerbating the contraction in the Spanish real estate market following the construction boom that saw almost five million homes built in the past decade. Home sales fell by more than a quarter in the year to January as banks withheld credit from potential buyers.

`` Spain's getting hit from all sides,'' Dominic Bryant, an economist at BNP Paribas SA in London, said. ``This is still the early stages, and unemployment is picking up pretty quickly already.''

Spain's economic growth will slow to 2.4 percent this year compared with 3.8 percent in 2007, the Bank of Spain said this month. The International Monetary Fund says the growth rate will be 1.8 percent, less than half of last year's pace.

``The deceleration is more intense than expected, especially in construction, but in manufacturing and services are still doing well,'' Deputy Finance Minister David Vegara said at a press conference today in Madrid. ``We still see a net increase in jobs in 2008.''

Vegara predicted that Spain's annualized economic growth slowed to less than 3 percent in the first quarter.

The yield on Spain's benchmark government bond fell 1 basis point to 4.45 percent and the price rose, the only of Europe's benchmark government bonds to advance today.

Europe's fifth-biggest economy created more than half of all new jobs in the euro region in the five years through 2006 as record low interest rates and surging construction fueled a virtuous circle of consumption and hiring. Now that process has gone into reverse as banks shut off funding to homebuyers and a glut of properties is depressing home prices. Mortgage lending fell 28 percent in the year to January.

``This is a credit crunch,'' Angel Berges, managing director of Analistas Financieros Internacionales told an April 7 construction industry conference. ``This is a result of the drought that Spanish banks are facing in the international markets.''

Employment in the construction industry fell by 73,200, or 2.7 percent, three times the pace of the previous quarter's decline, the report said. Manufacturing jobs increased by 59,400 or 1.8 percent.

Around 800,000 homes built in the past four years remain unsold, according to Bloomberg calculations based on data from the Housing Ministry and Sociedad de Tasacion SA, a real estate valuation company. Cesar Oteiza, director of operations at property web site, says there may also be as many as 300,000 second-hand homes for sale.

Luis de Guindos, chairman of Lehman Brothers for Spain and Portugal, says housing starts will collapse this year, with builders breaking ground on 200,000 new homes after 760,000 last year.

Real estate company Inmobiliaria Colonial SA was suspended from trading in Madrid for the eighth time this year today. The company has lost three quarters of its market value in six months as sales dried up and banks called in loans to its biggest shareholders.

IMF, Georgia review agenda of bilateral cooperation
IMF, Georgia review agenda of bilateral cooperation
Georgia opens new enterprise with support of Rural Development Agency
Georgia opens new enterprise with support of Rural Development Agency
Georgia sees decrease in COVID-19 cases
Georgia sees decrease in COVID-19 cases
Loading Bars
Iran's Securities and Exchanges Organization talks number of investors in capital market
Iran’s Bahar Azadi gold coin price rising
Volume of dry-farming land in Iran increases
Iran's NISOC begins excavations on its territory
Iran’s South Pars Gas Company reveals production data of its refinery
Iran waits for Europeans to comply with the JCPOA - MFA
Iran to make decision whether to open schools after Nowruz holiday
Production of LPG-fueled cars in Iran's interests - Chamber of Commerce
Armenia's war crimes exposed at UN Congress
Azerbaijan sees growth in Jan.2021 transactions via clearing system for small payments
Iran boosts car manufacturing
Spanish La Vanguardia: Return to Azerbaijan's Karabakh after war
Azerbaijan’s export of ferrous metal products down
Turkmenbashi Oil Refineries opens tender for purchase of gasoline
Britain's M&S expands online business to over 100 markets
Dustbin of history - place for former Armenian president Kocharian, 'Karabakh clan' - historian
Khazar Consortium opens tender to purchase cementing unit
Turkey’s food retail chain Migros to bolster gender-equal workforce and greener stores
Iran Mercantile Exchange working to expand sale of goods
Iran reveals COVID-19 data for March 8
Modi to inaugurate Maitri Setu between India and Bangladesh on Tuesday
India's Covid Vaccine Rollout "Rescued The World": Top US Scientist
India pre-eminent partner of US in Indo-Pacific region: Blinken tells Jaishankar
Bachendri Pal to lead all women team aged above 50 in a 5 month long Himalayan expedition
Satellite set for Mar 28 launch will provide near real time images of borders, quick monitoring of natural disasters
Sikh Fighter Pilot Memorial In UK To Honour Indians Who Fought In World Wars
IMF, Georgia review agenda of bilateral cooperation
Iranian President and Irish FM discuss JCPOA
Iran reserves strategic basic goods
Iran’s Rouhani asks for release of frozen assets in Iraqi banks
Iranian parliament approves increase of salaries to aid low incomes
Iran not to allocate Nowruz gasoline quota due to COVID-19
Uzbekneftegaz establishing production of import-substituting products for industrial enterprises
Iran to obtain its funds frozen in Iraq
Georgia opens new enterprise with support of Rural Development Agency
Interest in entrepreneurship growing among women in Azerbaijan
Export of cotton from Azerbaijan greatly increases in Jan. 2021
Mubarek oil&gas production dep’t owned by Uzbekneftegaz to increase natural gas production
Uzbekistan reveals its COVID-19 data for March 8
Iran unveils number of mining facilities put into operation
Japanese businessmen visit Azerbaijan’s Guba genocide memorial complex (PHOTO)
Development of Iran's Siyahmakan oil field launched
Nearly half of non-oil sector taxes in Azerbaijan falls on mobile operator in 2020
Azerbaijan's Azercell reveals number of processed requests in 2020
Azerbaijan's Jan. 2021 imports from EU show increase
Accumulative life insurance market in Azerbaijan grows
Iran capable of building long water transfer pipelines - Iranian VP
Deliveroo launches London IPO after business surges in 2020
Iran to publish final report of the downed Ukrainian jet soon
No direct or indirect relations between Iran and US - Iranian Foreign Ministry
Approval of FATF related bills would increase Iran's export revenue - Iranian Union
Iranian medicine importers awaiting approval of FATF related conventions
Turkey records slight decrease in car exports abroad
Cement exports from Turkey to global markets grow
Azerbaijan shows footage from Zangilan's Garagoz village (VIDEO)
Turkey's revenues from export of grains, legumes to global markets up
Moscow hosts opening ceremony of another 'Gifts of Azerbaijan' stand
Turkmenistan sells diesel fuel, gasoline to number of countries
Baku celebrating International Women's Day (PHOTO)
Kazakhstan's exports to Portugal plummet amid COVID-19
Kazakhstan boosts trade turnover with Lithuania
Oil supply to exceed demand in 2022, says JP Morgan
Georgia sees decrease in COVID-19 cases
Uzbekistan's gold deposit ranks in list of world's biggest gold mines by production
Azerbaijan's digital infrastructure project to generate Digital Silk Road between Europe, C.Asia
U.S. says all options on table for a decision on Afghanistan
Growth rate of agricultural production in Turkmenistan increases
Uzbekneftegaz reveals volume of oil products manufactured in 2M2021
Azerbaijan's First VP congratulates Azerbaijani women on International Women's Day
JP Morgan reveals 2021 oil demand & supply forecasts
Boom in Iran's housing sector create new jobs for local force
JP Morgan says OPEC to boost supply in 2021
OPEC crude output to exceed 30 mbpd in 2022 – JP Morgan
Uzbekistan, India talk mutual phytosanitary permits for agricultural products
Turkmenistan exceeds plan for transport, communication sector
Weekly review of Azerbaijani oil market
Nepal PM Oli receives first jab of Indian-made COVID-19 vaccine
Iran's economic development declines
IAM Construction LLC to reconstruct facility in Azerbaijan’s Seaside Park
Azerbaijan’s state interests on Azerbaijani-Armenian border protected at highest level
China's focus on annual GDP targets gives greater policy flexibility
Iran's CBI reveals amount of loans issued in Iran's trade sector
Buy/sell operations at Iran Mercantile Exchange on the rise
Iran kicks off development of Ramin oil field in Khuzestan Province
Iran reveals amount of loans issued in housing and construction sector
Iranian currency rates for March 8
Iranian banks issue big loans to agricultural sector
Iran boosts development of Zilayi oil field
Iran boosts exports via Zanjan Province
Iran's exports to Azerbaijan not on high enough level - Ali Jahangiri
State Oil Fund of Azerbaijan enters top five most transparent sovereign wealth funds
Large-amount loans issued in Iran's services sector
Excavations at Iran's South Pars gas field continue
Significant work done on water and electricity sectors in Iran – minister
Azerbaijan’s Buta Airways low-cost airline to resume flights from Baku to Ukraine’s Kyiv
Iran implements plan to maintain, increase extraction from several oil fields
Turkmenistan sees increase in trade turnover volumes
Japan government spokesman says timing of Biden-Suga meeting undecided
Exports to Iraq via Mehran crossing top $460m
Kazakhstan’s daily COVID-19 case count stands at 653
All news