We are starting to fulfill the fatal prophecy that the end of 2011 would be painful. In addition to Funcas and Fitch cutting the economic outlook for Spain and Goldman Sachs sounding the drums of another recession, family savings rates are falling and unemployment is rising. We just endured the worst September for jobs in the past 15 years.
Unemployment numbers shot up by 95,817 people to a grand total of 4,226,744 jobless workers. The services sector was the hardest hit, cutting 74,590 jobs and evidence that despite a small boom of seasonal tourist jobs, the Spanish labor market continues to be a wasteland.
The impact of a shifting business cycle and the virulent seasonality of jobs in this country combine to show a nation at the mercy of temporal changes. Only three regions were spared from rising unemployment: one by tourism and the others by the grape harvest. These small outliers provide little reason to believe in Salgado's sanguine employment forecasts.
With an unfavorable environment for Spain's economic future, slowing commerce in France and Germany, the impact of the euro crisis, ineffective 'mini' labor reforms and dragging domestic consumption, some hard months are up ahead. Urgent actions needs to be taken after the November 20 elections.
