The number of registered job seekers in Spain rose for the eighth month in a row in March to a new high, as the country slides back towards recession.

The number of workers registered as unemployed climbed by 0.82% from the previous month to reach 4.75 million.

This is the highest figure since the current statistical series began in 1996. 

The Spanish economy is still reeling from the collapse of a labour-intensive property bubble in 2008.

Spain's economy - the fourth largest in the euro zone - is expected to contract 1.7% this year, after posting a modest expansion of 0.7% in 2011, according to the government's estimates.

Figures released in January by the National Statistics Institute, which uses a different calculation method, showed a jobless queue of 5.27 million and an unemployment rate of 22.85% at the end of 2011. The government expects the unemployment rate - already the highest in the industrialised world - to surge to 24.3% this year.

Prime Minister Mariano Rajoy's conservative government passed a new labour reform in February which makes it cheaper and easier for companies to lay people off and cut wages unilaterally.

The government argues the reform - which has been hotly contested by unions - will spur job creation in the long term when the economy rebounds even as it predicts the unemployment rate will rise in the short term.

"We continue to face an unsatisfactory situations of an increase in the number of people registered as unemployed," secretary of state for employment, Engracia Hidalgo said in a statement. "This is why it is neceassry to reiterate the importance of creating confidence and flexibility for companies, as was done with the labour law reform," she added.

Spain's unemployment rate hit 23.6% in February, the highest rate in 17-nation euro zone, according to data published by the European Union's statisics office Eurostat yesterday. The unemployment rate for the entire euro zone stood at 10.8% during the same month, a 15-year record.

 

Spain says public debt will hit 79.8% of GDP in 2012

Spain's public debt will leap more than ten percentage points this year to 79.8%of gross domestic product, the finance ministry said today.

"Public debt will rise from 68.5% of GDP at the end of 2011 to 79.8%, a level which is still below the euro zone average of 90.4%," it said in a statement as Budget Minister Cristobal Montoro presented his government's 2012 budget to lawmakers.

The European Union has set a limit for public debt of 60% of gross domestic product.

Spain's public debt ratio has grown without interruption since the first quarter of 2008 when, after nearly a decade of fast growth and budget surpluses, which trimmed the debt, it amounted to 35.8% of GDP.

The public deficit has risen fast because the collapse of a property bubble in 2008 sent the Spanish economy into a downward spiral, causing tax revenues to drop even as spending on jobless benefits and other social spending shot up.