According to the latest study on unemployment in Spain the number of jobless rose above 20% during the last quarter of 2010 following a slight fall in September (19.8%). The report on the survey on the active population carried out by Agett for the National Institute of Statistics (INE) during the last three months of 2010 shows a rise of 1.2% in unemployment in Spain compared to the same period a year ago.

With information supplied by official unemployment records the survey found that the number of people out of work rose by 126,000 during the last quarter of 2010. The official unemployment rate which also depends on the evolution of the active population in Spain will be known on 28th January when the report by the INE is officially published. With an increase of 0.6% in the active population it is expected that the unemployment rate will rise above 20%. It also states that the total number of the active population in employment is 18.3 million.

Francisco Aranda, who was in charge of the study carried out by Agett says that ‘all indicators show that the rise in the unemployment rate is slowing down but we will continue to experience adjustments to the labour market over the next few months’.

He also said that employment levels would improve in the second quarter of 2011 but that it would take at least five years for employment levels to return to normal. This is why he said that the government would have to continue its ‘anti-crisis’ programmes and added that the Spanish government had reacted too late in order to effectively combat the effects of the recession. He also said that it was the government’s responsibility to continue applying reforms in order to stop businesses suffering and to boost employment levels.

Last year the cost of making employees redundant went down in Spain by 1.5% (the first time since records began in 2000) while salaries rose by just 0.

1%. Therefore according to the survey the cost of contracting workers fell by 0.3% compared to the same period a year ago.

Although the number of unemployed went down by 10,221 in December 2010 unemployment in Spain has actually risen compared to a year ago by 176,000 closing the year at 4,100,073.

The rate of unemployment for women and foreigners was especially high last year. On the other hand, unemployment levels for young people (under twenty five years old), a group which traditionally suffers high unemployment levels, improved. In 2010 the number of unemployed under 25 year olds fell by 13,000 which is a fall of 2.9% compared to the previous year.

Francisco Aranda said that ‘Spain has taken time to react to the current economic climate compared to other EU countries which have already made an effort to lift their economies out of recession’.

In his opinion this demonstrates the ‘enormous rigidity of the Spanish labour market both for businesses and workers’. He went on to say that Spain should have followed key examples such as Germany which has opted for modernizing work contracts and controlling salaries over the last decade – something which he says has given Germany a competitive edge.