A new official report shows Spain’s unemployment rate has remained beyond 25 percent for the sixth quarter in a row, making the country home to a third of the unemployed population in the eurozone.
The report for the final three months of 2013 will be released by the National Statistics Institute in Madrid on January 23. It shows the younger generation of the country has been hit hardest by slow recovery over the past years with youth unemployment standing at nearly 58 percent. The figure is the second highest in the world after Greece.
The report comes as the government of Prime Minister Mariano Rajoy predicts gross domestic product (GDP) to grow at least 0.7 percent in 2014. However, the country’s high jobless rate is the biggest obstacle in the premier’s path to lasting growth.
“There’s no doubt the economy is improving, but it’s not enough to significantly reduce the jobless rate,” said Josep Comajuncosa Ferrer, an economics professor at Esade Business School in Barcelona.
“High unemployment, with its social cost and impact on public finances, remains the big issue,” he added.
A fifth of Spain’s population lives under the threshold for poverty as defined by the EU’s statistics agency, Eurostat. The dearth of jobs and the deepest austerity in more than 30 years have pushed average household income down 10 percent since 2008.
“It would be very optimistic to say Spain’s unemployment rate has no implications for its economic outlook,” said Jonathan Loynes, chief European economist at Capital Economics Ltd. in London. “Surely it has to put a limit on the upturn in spending and income “