Catalonia unemployment jumps as political crisis drags on

By Paul Day

MADRID (Reuters) – Registered unemployment rose sharply in Catalonia in October, data showed on Friday, with more people signing on as jobless in the region than anywhere else in Spain as companies fled in the midst of the country’s worst political crisis in decades.

Almost 2,000 companies based in Catalonia moved their legal headquarters out of the region in October after an independence vote banned by Madrid that led to the central government sacking regional authorities and taking control.

The number of people in Spain registering as jobless rose for the third straight month by 1.67 percent in October from a month earlier, or by 56,844 people, leaving 3.47 million people out of work, data from the Labour Ministry showed.

Of that, Catalonia saw unemployment rise by 3.67 percent, or 14,698 people, the largest loss of jobs amongst all the regions and compared to a just 0.08 percent rise in jobless in the region of Madrid.

The Bank of Spain warned on Thursday that uncertainty due to the independence drive, if it persists, could lead to slower economic growth and lower job creation in the next few months.

October often sees a continuation of rising unemployment after the summer tourist sector lays off temporary workers in hotels and restaurants.

Registered jobless rose strongest in the service sector, with a 2.2 percent monthly rise, or by 50,885 people, followed by agriculture, marking the end of summer harvests, up 5.83 percent, or 9,194 people.

In Spain, the number of people paying in to the social security system as workers in Spain rose by 94,368 people, to 18.43 million people, the ministry said.

In seasonally adjusted terms, Spain’s registered unemployed fell by 23,690 people in October from a month earlier.

Spain’s unemployment rate, taken from a wide survey of the workforce a considered a more accurate representation of the country’s unemployed than the monthly figure, fell to its lowest since 2008 in the third quarter at 16.38 percent.

(Reporting by Paul Day; editing by Ralph Boulton)