Spain: Unemployment rate ticks up in Q1
April 26, 2018
The jobless rate inched up to 16.7% in the first quarter, coming in above the 16.6% logged in the fourth quarter of last year and marking the second consecutive quarter where the unemployment rate has increased. That said, the first-quarter figure remains one of the lowest prints in the last nine years and largely reflects seasonal weakness caused by the end of temporary jobs linked to the winter holiday. In absolute terms, the number of unemployed people rose to 3.80 million in the first quarter, a tad above the 3.77 million jobless recorded in the fourth quarter.
Employment losses were centered in the services sector, where 110,500 jobs were shed in the first quarter due to the end of the Christmas season. Jobs were also cut in the industrial sector (-34,900), while they rose in the agricultural (+13,100) and construction (+8,200) sectors. In line with the seasonally-induced decline in employment, temporary jobs were down 128,000 in Q1, while permanent positions only declined 1,400. Meanwhile, the workforce declined by 94,700 in Q1 to a total of 22.7 million.
Notwithstanding the back-to-back increase in the unemployment rate, a rosy economic outlook and improved competitiveness abroad should fuel strong employment growth this year and contribute to a further decline in the unemployment rate. A robust pace of job creation and relatively subdued inflation will continue supporting households’ disposable income, fueling another year of resilient growth in 2018.
Spain Unemployment Rate Forecast
FocusEconomics Consensus Forecast participants expect unemployment to average 15.4% next year, which is unchanged from last month’s projection. For 2019, the panel foresees an unemployment rate of 14.2%.
Author: David Ampudia, Economist