Spain Joblessness Breaches 25%, Adding to Rescue Pressure
By Angeline Benoit - Oct 26, 2012 3:00 AM ET ..Facebook Share LinkedIn Google +1 33 Comments
Spanish unemployment climbed to a record in the third quarter as a deepening recession left one in four workers jobless, adding pressure on Prime Minister Mariano Rajoy to seek a second European bailout.
Unemployment, the second highest in the European Union after Greece, rose to 25.02 percent from 24.6 percent in the previous quarter, the National Statistics Institute said in Madrid today. That is the highest since at least 1976, the year after dictator Francisco Franco’s death led Spain to democracy.
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Spain’s Unemployment Breaches 25%, Adding to Bailout Pressure Angel Navarrete/Bloomberg
Jobseekers stand and wait for an employment office to open in Madrid.Photographer: Angel Navarrete/Bloomberg
“The situation is serious,” Ricardo Santos, an economist at BNP Paribas SA in London, said by telephone. “There is still room for a deterioration in unemployment. Activity is weak and the government will reduce jobs as there are strict targets to adjust the number of public-sector temporary workers, especially in health and education.”
Nearly three months after the European Central Bank offered bond buys to lower its borrowing costs, Spain is still playing for time. Economy Minister Luis de Guindos said on Oct. 23 that the recent improvement in funding conditions shows they depend on investors’ perception of the euro’s future rather than domestic issues.
