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Spain’s unemployment dropped in June at the start of the peak tourism season, with the government predicting the trend will continue as the worst economic slump in the country’s democratic history comes to an end.
The number of people registering for jobless benefits fell by 127,248 from May to 4.76 million, the Labor Ministry in Madrid said today in an e-mailed statement. That is the sharpest decline on record for a month of June. Economists had predicted a decline of 100,000, according to the median of 5 forecasts in a Bloomberg News survey.
Spain, with an unemployment rate of 27 percent, is home to almost a third of all the people out of work in the euro region.
Economy Minister Luis de Guindos last month said Spain will see a durable improvement in employment as rising exports help haul the euro-area’s fourth-largest economy out of its second recession since 2008 in the three months through September. The Bank of Spain last week said indicators suggest the recession is abating after seven straight quarters of contraction. Exports rose to a record last year, while the country in March posted its first trade surplus since at least 1971.
Still, the nation’s current account swung back into a deficit in April, and households’ wage income fell 8.5 percent in the last quarter from a year earlier after a labor-rules overhaul helped companies to cut payrolls.
The Organization for Economic Cooperation and Development predicted in May that Spain’s jobless rate will rise to 28 percent in 2014, saying a slump in household demand will be worse than previously estimated this year. The economy will contract 1.7 percent in 2013 before rising 0.4 percent next year, the Paris-based OECD said in its Global Economic Outlook.
With assistance from Harumi Ichikura in London and Ben Sills in Madrid. Editors: Paul Gordon and Zoe Schneeweiss.
To contact the reporter on this story: Angeline Benoit in Madrid at firstname.lastname@example.org. To contact the editor responsible for this story: Craig Stirling at email@example.com.