The numbers are grim. The economy is in deep recession. In the first three months of the year GDP shrank for a seventh quarter in a row. The public finances remain stretched, with the budget deficit at 7% of GDP. Bond yields have fallen, but the credit crunch for small firms is worsening. Corporate bankruptcies are running at ten times pre-crisis levels. And unemployment is at a record 27%.
Wow, and the problem of unemployment among young people is of epidemic proportions.
JOSÉ GARCIA used to work as a doorman. But two years ago he lost his job. Since then the 62-year-old has lived off unemployment insurance built up when he was working. This month it runs out. Now he hopes for €426 ($550) a month in long-term state subsidy. With unemployment above 27%, he does not expect to work again. “I’ll keep looking, but the queue will always be long,” he says.
The jobless rate is unlikely to drop below 25% before he claims his pension at 65. The prime minister, Mariano Rajoy, hopes to turn the jobs corner before the next election in late 2015, but his record so far is dismal. Over the past 17 months 1.2m jobs have gone, taking the total lost since 2007 to over 6m. Net job growth needs GDP growth above 1%, yet the government does not predict that until 2016. In the European Union only
jobless figures are worse. And in southern provinces such as Greece the rate is above 40%. Among under-25s,
the figure is a horrific 57%. Cadiz
Europe. You now have firstly established the first massive recession that
is totally man made and was totally preventable.