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A quick fix

Why does the new year always seem to start with the Spanish government marvelling at how rapidly it is reducing the country's unemployment rate? Overall, there were 390,354 less claims in 2016 than in 2015 - the biggest annual reduction seen since 1999. Although much lowered from a crisis peak of 27% in 2013, Spain's high unemployment level, at 18.9%, is its biggest obstacle to robust economic growth. But the new year statistics show that the problem is being expertly tackled by Mariano Rajoy's government. Right?

Not so fast. The sub-headline of an article that appeared this week on Bloomberg, the economics newswire, inadvertently demonstrated why figures such as these can be deceptive. 'Decline in Unemployed Welcome News for Prime Minister' it read. Well, quite: official banner statistics like those just released are very useful indeed for Rajoy, who has promised to create 500,000 jobs a year throughout his second term. Yet they don't, as the headline incorrectly suggests, mean that the long-term unemployed in Spain are heading back to work in substantial numbers. In other words, when you see titles like this regard them as misleading until proven otherwise.

This time last year, similar figures were on offer. In January 2016, Spain's national statistics institute revealed that in 2015, unemployment dropped by 12.4% to the lowest level since 2011. The same data, though, showed that the amount of temporary jobs created throughout this supposedly bumper year was double the amount of new permanent jobs. Last September, figures released indicated that 1.5 million employment contracts are signed in Spain every month. In the first half of last year, though, a quarter of these were for a week's work.

Employment statistics from December are deceptive in the same way that the spring and summer's are: with the arrival of a holiday season, many unemployed people are able to find temporary work in catering or retail. Accordingly, the amount of claims made always drops in these months, increasing again as the short-term roles expire (in the autumn and new year, respectively). At the end of August this year, for example, there were 14,435 more unemployed people registered in Spain than in July. Temporary contracts are the Spanish labour market's fundamental weakness and recent data should be regarded with a good degree of scepticism.

Technically, all that's required for a new position to be created - and for it to count as being one of Rajoy's half a million a year - is for a contract of employment to be signed between employee and employer. But if a great many of these offer work for only a few weeks, their creation won't help solve Spain's unemployment problem. The quick-fix approach doesn't help the 60% of Spaniards without work who have been unemployed for a year or more. Only if Rajoy can reduce this percentage and offer workers more stability and protection will Spain's jobless rate really be under control. In the meantime, don't take the headlines too seriously.