The number of registered jobless in Spain fell back very slightly - by 0.6 percent -in March from February, but was sharply up - by 11.73% on a year by year basis, according government data released by the national labour agency (INEM) today. On the surface this could be taken as mildly positive news (as it has been in some of the press commentary, since it breaks a run of five consecutive months of unemployment increase as the Spanish economy has been slowing, but the truth here lies in the details. The number of unemployed fell by 14,356 people to just over 2.3 million in March. But, for seasonal reasons unemployment normally rises in March, and this years rise has been very small indeed. In fact this is the smallest March increase since 2001, a year when many parts of the European economy - but not Spain - were also headed for recession.
The Bank of Spain forecast earlier in the week that unemployment would rise to 9 percent this year and 9.8 percent in 2009, and this in spite of a 22 billion euro ($34.38 billion) fiscal stimulus package due to be released soon by the government.
The last government unemployment figures, as opposed to the number of registered jobless, were released in January and showed unemployment at 8.6 percent in the fourth quarter, up from 8 percent three months earlier. March's joblessness decrease was not that disimmilar from that registered in March 2007, when the number of unemployed fell by about 16,000. And the construction industry was already begining to feel signs of slowdown at this point, let it be noted. Since that time the number of jobless has risen by 240,000 over the past 12 months as the construction boom which fuelled economic growth for a decade went into reverse and the banking and financial sectors began to be hit by the impact of the credit crunch.
Perhaps the most revealing chart of all here is the one which shows the year on year change in unemployment, and where we can see how a quite positive (decline in) unemployment situation has little by little been being converted into its opposite.