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Private sector hiring drives Spanish unemployment to pre-financial crisis levels

Published 01/27/2022, 03:03 AM
Updated 01/27/2022, 05:25 AM
© Reuters. FILE PHOTO: A waitress servers food to customers at the terrace of a bar in downtown Ronda, Southern Spain, September 2, 2021. REUTERS/Jon Nazca

MADRID (Reuters) -Spanish unemployment fell in the fourth quarter to its lowest since the onset of the financial crisis of 2008, data showed on Thursday, as hiring in the farming and service sectors drove a swifter-than-expected rebound from coronavirus-driven layoffs.

The rate fell to 13.33% from 14.57% in the previous quarter, a decline that Economy Minister Nadia Calvino called "spectacular" and comfortably below the 14.20% forecast by economists polled by Reuters.

The highly seasonal National Statistics Institute (INE) reading was the lowest since the third quarter of 2008, when it stood at 11.23%, and the lowest for a fourth quarter since 2007's 8.57%.

Private-sector hiring accounted for all of the 153,900 jobs added over the period, with agriculture leading the gains as farms took on extra workers to help with the autumn olive and grape harvests.

But it was the tourism-reliant Canary Islands that added the most jobs among Spain's regions, reporting a 7% jump as the Atlantic archipelago attracted crowds of winter sunseekers from northern Europe.

Foreign tourism to Spain accelerated in the last quarter of 2021 but remains roughly 40% below pre-pandemic levels.

Over 2021, Spain added more than 840,000 new jobs - the biggest jump since 2005 - largely due to increased hiring in the services industries.

Since peaking at 16.26% in the third quarter of 2020, when Spain was reeling from the impact of COVID-19's devastating first wave, unemployment has dropped for five straight quarters.

The arrival of the highly infectious but less virulent Omicron variant pushed up cases to record highs in December, leading to a spike in sick-leave absences.

© Reuters. FILE PHOTO: A waitress servers food to customers at the terrace of a bar in downtown Ronda, Southern Spain, September 2, 2021. REUTERS/Jon Nazca

But a light-touch response from the government, which declined to reintroduce curbs on movement and business activity, meant that any structural impact on employment was limited.

Thursday's INE reading did not include the roughly 100,000 workers still enrolled in the government furlough scheme at the end of last year.

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