Unemployment falls in the Balearics but hits new high in Spain

THE Balearics “is back on track” according to the local government after February's unemployment showed a third consecutive drop in the number of people out of work in the region.

Although the fall was just 1.17 percent, the Balearics was the only region in Spain to see unemployment figures fall.
The government's Director General for Strategic Planning, Llorenç Pou, said that the figures show that unemployment may have bottomed out in the Balearics and will now continue to fall, “but, we'll have to wait and see what happens over the coming months if this trend is going to continue,” he added.

However, he did admit that the situation in the work place is still “very difficult” and that the government remains deeply concerned about the fact there are still 89'662 people officially registered as unemployed although the unions maintain that according to the active population figures, the real number continues to be around the 100'000 mark because many people have signed off or seen their dole entitlement run out.

And, the fact there were 1'064 less people out of work during February than in January, the opposition Partido Popular accused the government of being incapable of creating jobs. “If the government is not able to stimulate the local economy, how does it expect to create new jobs,” the PP's parliamentary spokesperson, Antoni Pastor, said.

Pastor said that the Balearics has the third highest regional government deficit in Spain at 4.16 percent, 1.76 percent above the limit set by the government which yesterday issued another warning to the Balearics about getting its deficit under control. (See page 7).

But, at least the Balearic job market is bucking the national trend. Across the country, the number of Spaniards out of work rose for a second consecutive month in February, adding to government problems in cutting spending and restoring the public finances.

There were nearly 4.3 million people registered as unemployed last month in Spain, which has the highest jobless rate in the industrialised world, a rise of 68'260 people or 1.6 percent from January, the labour ministry said.

Compared with 12 months ago, the figure was up 4.0 percent or 168'638.
The rise in the number of those unemployed and claiming benefit adds to the squeeze on public sector finances just as the government is trying to stamp out fears that Spain will need an Irish-style EU-backed bailout. “The latest unemployment data were very disappointing, providing further evidence that negative sentiment in the household economy is going to linger during 2011,” said Raj Badiani, an economist at IHS Global Insight in London. “Firms continue to exercise a very cautious approach to hiring as a result of the weak domestic demand conditions and tight profit margins,” he added.

The government does not provide a jobless rate but the national statistics institute, which uses a different calculation method from the labour ministry, said in January that it stood at 20.33 percent at the end of 2010.

That is the highest level in the Organisation for Economic Cooperation and Development and topped the government target of 19.4 percent for the year.
Spain's booming construction industry drew millions of unskilled immigrant workers and generated high levels of economic growth in the decade to 2008. But the collapse of the property bubble, compounded by the global financial crisis, left many people out of work, especially immigrants and youths.

Secretary of state for employment, Mari Luz Rodriguez, called yesterday's unemployment figure “a bad number” but she stressed that the rise in joblessness was smaller then those posted in February 2010 and 2009.