Portugal unemployment hits new record

Portugal’s unemployment rate rose sharply in the first quarter of 2013 to a record high 17.7 percent from 16.9 percent in the fourth quarter of last year, data from the national statistics institute showed on Thursday.

For the whole of 2013 the government has forecast a rate of 18.2 percent and 18.5 percent for next year as the effects of recession and austerity measures take hold.

The new record high comes as a new government spending package, announced by the centre-right government last week, includes the slashing of 30,000 public sector jobs out of a total 700,000.

In 2012, the Portuguese economy contracted by 3.2 percent and is forecast to shrink another 2.3 percent in 2013.