Spanish Unemployment At ~25%, How Can This Be Sustained?

[WilliamC]

It seems Spain now has 1 in 4 workers unemployed. I don't understand how this can be sustained for much longer, I don't think it will be.

Anyone on the ground in Spain? Eduardo?

http://www.bbc.co.uk/news/business-17866382

Spanish unemployment has hit a new record high, official figures have shown.

The number of unemployed people reached 5,639,500 at the end of March, with the unemployment rate hitting 24.4%, the national statistics agency said.

The figures came hours after rating agency Standard & Poor's downgraded Spanish sovereign debt.

Official figures due out on Monday are expected to confirm that Spain has fallen back into recession.

Earlier this week, the Bank of Spain said the economy contracted by 0.4% in first three months of this year, after shrinking by 0.3% in the final quarter of last year.

Other figures released on Friday showed that Spanish retail sales were down 3.7% in March from the same point a year ago, the 21st month in row sales have fallen.
'Huge crisis'

In the first three months of the year, 365,900 people in Spain lost their jobs.

The country has the highest unemployment rate in the European Union and it is expected to rise further this year.

“The recession is so deep that when you take one step forward on austerity, it takes you two steps back”

Stephen King Chief economist, HSBC

What ails the Spanish economy?

The rate has risen sharply since April 2007, when it stood at 7.9%.

"The figures are terrible for everyone and terrible for the government... Spain is in a crisis of huge proportions," Foreign Minister Jose Manuel Garcia-Margallo said.

The new government has announced reforms to the labour market, including cutting back on severance pay and restricting inflation-linked salary increases, that it hopes will ease the problem.

These measures have angered unions, which have organised widespread general strikes in protest.

The government has also introduced drastic spending cuts designed to reduce its debt levels and meet deficit targets agreed with the European Union. These cuts are contributing to Spain's economic contraction.

"In Spain today, a cycle similar to Greece is starting to develop," said HSBC chief economist Stephen King.

"The recession is so deep that when you take one step forward on austerity, it takes you two steps back."

The interest rate, or yield, on Spanish government bonds traded in the secondary market rose following the release of the unemployment figures and the S&P downgrade.

The yield on 10-year bonds rose to 5.96%, up from 5.81%, suggesting investors were becoming more wary of Spain's ability to repay its debts.

Also on Friday, the interest rate Italy has to pay to borrow money from international investors rose. In a sale of 10-year bonds, the government offered a rate of 5.84% compared with 5.24% at a similar sale a month earlier.

However, the government raised 5.95bn euros ($7.88bn; £4.85bn), towards the top end of its target range.
'Comprehensive' reforms

Late on Thursday night, the ratings agency Standard & Poor's cut Spain's rating by two notches to BBB+, warning that the country might have to take on more debt to support its banking sector.

S&P predicts the Spanish economy will shrink by 1.5% this year, having previously forecast 0.3% growth.

However, the agency did make a number of positive comments about the government's attempts to bolster Spain's economy.

"We believe that the new government has been front-loading and implementing a comprehensive set of structural reforms, which should support economic growth over the longer term," S&P said.

"In particular, authorities have implemented a comprehensive reform of the Spanish labour market, which we believe could significantly reduce many of the existing structural rigidities and improve the flexibility in wage setting."

See bold text for their real problem, seems we have a horror writer in charge of the economy. heh heh.

[Demigod]

Black market

Everywhere in Southern Europe the official unemployment is 15% + for decades now but a large portion of the population that works in the tourism,agriculture and street selling is not registered as employed so not to pay taxes.

[JebSanderson]

Youth unemployment is 47%

[LibForestPaul]

Black market

Everywhere in Southern Europe the official unemployment is 15% + for decades now but a large portion of the population that works in the tourism,agriculture and street selling is not registered as employed so not to pay taxes.

Upper class (theft), lower class (hand-outs), terrorized class (black markets), criminal class (illegal markets)
by design
lower class in fear of survival (death, homelessness, sickness)
upper class kept in power by lower class
terrorized class in fear of upper class(tax theft and government force) , criminal class (pain and retribution), lower class (theft and assault)
criminal class with symbiotic relation with upper class (never over the line).

[Paul Or Nothing II]

Oh, wonders of centralized moneysupply + institutionalized freeloading & socialism

And I'm sure they're blaming the "free market" & "capitalism" for all of this mess while asking for more government intervention & more socialism/communism

This isn't just happening by chance, people with their ignorance & opposition to freedom have brought this upon themselves; when people support government violating others' liberties for the sake of perceived personal gain, soon enough they'll see their own liberties getting violated, that's how it works!

Like the great French mind Frederic Bastiat has said - "State is the great fiction through which everyone endeavours to live at the expense of everyone else"
"When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it."
"But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime."

[Pauls' Revere]

Seems the G 20 nations are pumping money into the IMF which in turn lends it to the E.U.

The International Monetary Fund is seeking to more than double its war chest by raising $600 billion in new resources to help nations deal with the fallout of the euro zone debt crisis.

But most G20 countries have said that before they inject any new money into the IMF, the euro zone must first put up more of its own money to resolve its sovereign debt crisis.

In response, finance ministers from the 17 countries sharing the euro, called the Eurogroup, on Friday raised the combined lending capacity of their two bailout funds to 700 billion euros from 500 billion.


http://arabnews.com/economy/article602676.ece


Last time I checked Spain is part of the E.U.

[Liberty74]

Good god people, socialism is a complete failure as predicted. It is never sustainable. Across the Atlantic they borrowed and taxed their way to economic growth. They tax their GDPs at around 70% on average today. Who is really left to taxed? They have borrowed to the point in which no one wants to give them any more money. The European countries have done nothing but propped up their control system to give an illusion that socialism worked. Now the bills are coming due...heck 44% of Britons want to leave the U.K. because of high taxes, high standard of living and no jobs. Many rich are also leaving France.

Spain went into the green jobs market that destroyed 2.1 real jobs for every 1 green job the government created at a cost to the taxpayers of like $1.2 million per green job. See, Socialists and Marxists are very good at math.

[InTradePro]

And the real rate in the U.S. is?

[WilliamC]

And the real rate in the U.S. is?

Close to 20% but not over.

With black and grey market employment included around 12 to 15% would be my guess.

[bultza]

in Andalusia,Canarian Island and in another regions of spain there are 33% of unemployement.
in my region "only" 16-20%

At the moment there are not many protests because thera are a lot of underground economy, black employement and government subsidies paid with taxes very highs