Bloomberg News

Spain September Registered Jobless Rises Most Since January

October 04, 2011

(Adds comment from Salgado from fourth paragraph.)

Oct. 4 (Bloomberg) -- Registered unemployment in Spain, which has the highest jobless rate in the European Union, rose in September by the most since January as the end of the tourism season led service companies to drop workers.

The number of people registering for unemployment benefits climbed by 95,817 to 4.22 million people, the Labor Ministry in Madrid said in an e-mailed statement today.

Spain’s manufacturing industry contracted by the most in more than two years in September, Markit Economics reported yesterday, citing its purchasing managers’ index. That may further undermine the government’s efforts to pull the economy out of a three-year economic slump and reduce the unemployment rate of 21 percent.

Speaking in an interview with RNE radio from Luxembourg today, Spanish Finance Minister Elena Salgado said the figure for registered unemployment is worse than expected, though that doesn’t “change plans.”

“Evidently the austerity measures have an influence on growth in Spain and in other European countries, but in the short term our priority is fiscal consolidation,” Salgado said on Oct. 3.

Prime Minister Jose Luis Rodriguez Zapatero, whose party trails in opinion polls before the Nov. 20 general election, said on Sept. 14 that Spain may miss its 1.3 percent growth forecast for this year because of the impact of the Greek crisis. The expansion slowed to 0.2 percent in the three months through June from a quarterly rate of 0.4 percent in the first three months of the year, and Zapatero said growth will remain around 0.2 percent in the next two quarters.

The opposition People’s Party, which has pledged changes to labor and tax rules to reduce the 46 percent youth unemployment rate, may win the election by the largest margin on record, El Mundo reported on Oct. 2, citing a poll. It may win 47.4 percent of the vote, giving it an outright majority in Parliament, compared with 31.8 percent for the Socialists, El Mundo said.

--With assistance from Anabela Reis in Lisbon. Editors: Jennifer M. Freedman, Jeffrey Donovan

To contact the reporters on this story: Emma Ross-Thomas in Madrid at erossthomas@bloomberg.net; Angeline Benoit in Madrid at abenoit4@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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