January ushers in historic swell in jobless figures

5th February 2008, Comments 0 comments

New report identifies high rate of inflation in basic goods

5 February 2008

MADRID - The number of people looking for work in Spain in January shot up at the fastest pace in at least a quarter of a century as an economic slowdown that began last year led companies to shed staff in all sectors nationwide.

Registered unemployment, defined as the number of people actively seeking work at unemployment offices, climbed 6.22 percent last month - the biggest January increase since comparable records began in the early 1980s. By the end of the month, just over 2.26 million people were looking for work, 132,000 more than in December and almost 180,000, or 8.62 percent, more than in January 2007.

"This is very, very bad news," Labour Minister Jesús Caldera acknowledged, blaming most of the job losses on real estate and construction firms shedding workers as Spain's decade-long property boom ends.  He argued nonetheless that recent increases in unemployment should not mask the "strong jobs growth" throughout the legislature.

Indeed, since the Socialist Party came to power in 2004, unemployment as measured as a percentage of the active population has fallen from 11 percent to 8.5 percent as a high rate of job creation has helped absorb increasing numbers of workers, especially immigrants. In real terms, however, the figure of 2.26 million unemployed is actually higher than when the Socialists took office, an uncomfortable statistic for the party as it prepares for a general election on 9 March.

"This is a real drama... we've been losing 4,400 jobs a day for the last month," declared conservative opposition leader Mariano Rajoy, who has sought to capitalise on Spaniards' economic concerns in his election campaign.

A report on consumer prices published yesterday by a Catalan savings bank is likely to give Rajoy further ammunition with which to attack the government and consumers more reason to worry about their wallets.

The study by Caixa Catalunya shows that the price of a basket of commonly bought products, ranging from eggs and bread to tobacco and gasoline, increased by 7.9 percent last year, almost double the 4.2 percent rate of inflation officially reported by the government. Though the bank's sample of products is smaller, analysts argue that it better reflects average consumers' living costs.

[Copyright EL PAÍS 2008]

Subject: Spanish news

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