September job creation in Spain returns to recession levels

Europe

Spain posted its weakest job creation for the month of September in six years, amid a slowdown in the eurozone’s fourth largest economy which will hold a repeat general election next month.

The number of new contributors to the social security system, a measure of job creation, was up by just 3,200 in September over the previous month, according to the labour ministry.

It was the weakest figure for the month of September since 2013, when Spain was still grappling with recession, according to an analysts report from Spanish bank BBVA.

Registered unemployment rose by 13,900 in September, a 0.45 percent increase over the previous month, bringing the total number of people without a job to just over three million.

September is traditionally a bad month for unemployment in Spain as many seasonal contracts in the country’s key tourism sector come to an end.   

The Spanish economy, which had outpaced the average growth of eurozone countries in recent thanks to strong internal demand, has lately shown signs that it was cooling due to the slowdown in the global economy and political
instability at home.   

The Bank of Spain last month cut its growth forecast, saying it now expects expansion of 2.0 percent this year, with a further deceleration to 1.7 percent in 2020. That compares with June projections for growth of 2.4 percent this
year and 1.9 percent in 2020.   

The Spanish economy expanded by 2.4 percent in 2018.    

“We are in a context of a slowdown in the labour (market) and a slowdown in the economy,” Economy Minister Nadia Calvino told reporters when asked about the figures, before adding that “Spain is resisting better than other countries in the current context of international uncertainty.”   

Spain will go to the polls again on November 10th for the fourth time in as many years after acting Socialist Prime Minister Pedro Sanchez was unable to form a government following an inconclusive April general election.

READ MORE: No-deal Brexit ‘would mean 70,410 job losses in Spain’

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