Spain raises 2011 jobless rate forecast

Spain, which has the highest unemployment rate among industrialised countries, revised upwards its forecast for 2011 to 19.8 per cent from 19.3 per cent.

The rate will ease to 18.5 per cent in 2012, 17.3 per cent in 2013 and 16 per cent in 2014, Finance Minister Elena Salgado told a news conference. The figures are all higher than previously forecast by the government.

“These are figures which are more realistic,” Salgado said.

The new predictions, however, are still below those of the Bank of Spain, which said last week that the unemployment rate “may continue to rise in 2011 and will only begin to fall slightly in 2012 in the absence of additional labour market measures.”

The labour ministry said Monday that the number of Spaniards out of work rose for a third consecutive month in March, up 0.8 per cent from February to 4.33 million for the highest level since records began in 1996.

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 per cent 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 per cent 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.

Salgado also cut the country’s 2012 growth forecast to 2.3 per cent from 2.5 per cent but maintained the estimate that the public deficit will drop to 4.4 per cent of output that year from 6.0 per cent in 2011.

For this year, the government left unchanged its forecast for growth of 1.3 per cent.

The Spanish economy, the European Union’s fifth biggest, contracted by 0.1 percent in 2010 after shrinking 3.7 per cent in 2009.

Spain, along with bailed-out Greece and Ireland, were the only eurozone economies to shrink in 2010.

Meanwhile, thousands of youths took to the streets of Madrid last Thursday to protest against high unemployment, job insecurity and government spending cuts, responding to an initiative launched on the Internet.

“We will not shut up, we will not resign ourselves,” and “Enough!” were among some of the signs on display as the mostly young protesters made their way though the streets of the Spanish capital during the evening rush hour.

Organised on Facebook, where the group dubbed “Youth Without a Future” has over 7,000 followers, organisers said they were inspired by the youth uprisings in north Africa and similar protests in other European nations.

“We want to recover our capacity to be the motor of change, fighting a nation of insecurity, unemployment and the privatisation of our education,” the group said in its manifesto which was handed out at the protest.

“Italy, France, Greece and Iceland taught us that mobilisation is indispensible. The Arab world has shown us that victory is possible.”

Many of the participants said their lives were on hold because a lack of stable jobs even for the most qualified graduates means they have little alternative but to live with their parents.

Manuela Astacio, 24, said she has not been able to find work since 2007 despite having two years of work experience as a journalist with Spanish news agency EFE and being fluent in English.

“I am not sure if this will change things but at least we will be heard,” she said as she held up a sign that described her struggle to find work.

Spain’s unemployment rate for those under 25 stood at 43.5 per cent in February, more than twice the average for the country and the highest youth unemployment rate in the 27-nation European Union.

“Almost half of Spain’s youths are unemployed,” said Ivan Alonso, who has not been able to find a job to help support himself while he pursues his university studies in Madrid.

“I have been unemployed for three years. The government is starting to reduce scholarships and without a scholarship or a job it will be impossible to continue studying,” he added as he handed out fliers at the protest.