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Fall In Unemployment Claims Consistent With EC Employment Survey Trends

SPAIN DATA

Unemployment claims data released this morning ended a 3-month streak of sequentially increasing claims, with all sectors contributing to the downside.

  • Total NSA claims fell by -24.6k in November, not enough to offset the +36.9k rise seen in October. Services, which account for around 72% of the Spanish labour market saw a -17.3k fall (vs +31.3k in October). However, the stock of unemployment claims in services fell -4.5% Y/Y, and Y/Y rates have now been negative for 31 consecutive months.
  • The European Commission's expected employment indicator for Spain has been trending upwards since October 2022, both overall and for services specifically. While the November print saw services expected employment fall to +15.6 (vs +18), the 3M average rose to +16.1 (vs +15.2). This suggests there are upside risks to INE's services sector employment index (where the September reading printed at an index value of 113.6 vs 112.6 in August).
  • Given the unemployment claims data is not seasonally adjusted, a further fall is likely in December, particularly for services.
  • Longer term trends in unemployment claims alongside the Q3 labour cost survey (released 18 December) are most important in assessing the tightness of the Spanish labour market. Services inflation has remained sticky above 4% Y/Y in recent months, and a loosening of the services labour market will be required to bring these rates lower.

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Unemployment claims data released this morning ended a 3-month streak of sequentially increasing claims, with all sectors contributing to the downside.

  • Total NSA claims fell by -24.6k in November, not enough to offset the +36.9k rise seen in October. Services, which account for around 72% of the Spanish labour market saw a -17.3k fall (vs +31.3k in October). However, the stock of unemployment claims in services fell -4.5% Y/Y, and Y/Y rates have now been negative for 31 consecutive months.
  • The European Commission's expected employment indicator for Spain has been trending upwards since October 2022, both overall and for services specifically. While the November print saw services expected employment fall to +15.6 (vs +18), the 3M average rose to +16.1 (vs +15.2). This suggests there are upside risks to INE's services sector employment index (where the September reading printed at an index value of 113.6 vs 112.6 in August).
  • Given the unemployment claims data is not seasonally adjusted, a further fall is likely in December, particularly for services.
  • Longer term trends in unemployment claims alongside the Q3 labour cost survey (released 18 December) are most important in assessing the tightness of the Spanish labour market. Services inflation has remained sticky above 4% Y/Y in recent months, and a loosening of the services labour market will be required to bring these rates lower.