Jobless claims fall but labor market still in pitiful state

Jobless claims in Spain fell for the first time in nine months in April, but at a much slower pace than in the same month a year earlier.

According to figures released Friday by the Labor Ministry, the number of people officially registered as out of work fell by 6,632, or 0.14 percent, to 4.744 million.

April is normally a good month for the job market as companies increase hiring ahead of the Easter holiday period. However, the number of unemployed people in April last year fell by 64,309.

The figures for April of this year are only better than those in 2008 and 2009, when Spain was in the grip of its worst economic downturn in living history. Compared with a year earlier, the number of people out of work climbed by 11.12 percent, or 474,875.

The National Statistics Institute (INE) said earlier this week that Spain slipped back into recession again at the start of this year as GDP contracted on a quarterly basis for the second quarter in a row.

According to the INE’s Active Population Survey (EPA), the jobless rate in the first quarter of the year increased to 24.44 percent from 22.85 percent at the end of last year.

“In line with the trend of a strong increase in unemployment as seen in the EPA, registered unemployment in April continued to reflect the negative impact of the economy on the labor market,” the secretary of state for employment, Engracia Hidalgo, said. “This is the impact of the second recession we are suffering from.”

The official said that the government expects an increase in unemployment in 2012, with only a slow recovery in subsequent years.

The government in February decreed a drastic overhaul of the laws governing the labor market that make it cheaper and easier to sack workers. It argued the reforms were needed precisely to address the problem of surges in unemployment in Spain during economic downturns.

Hidalgo said Friday that the reform provided companies with greater flexibility in finding alternatives to laying off workers during crises.

In April, jobless claims declined in services, construction and agriculture, but rose in industry and in the case of first-time jobseekers.

Permanent work contracts awarded in April amounted to 92,123, only 8.98 percent of the total, and down 6.36 percent on the same month a year earlier. One of the objectives of the labor reform was to reduce the high levels of workers on temporary contracts.

The number of people signed on with the Social Security system increased by 16,549, or 0.10 percent, from March, but fell 3.18 percent from a year earlier.

“The [Social Security] affiliation numbers point to private consumption falling at a rate of 2.0 percent,” Reuters quoted Corstal Consors economist Estefania Ponte as saying. “The employment situation is not helping private consumption and continues to highlight the negative situation of the Spanish economy.”