Spain's Jobless Rate Hits Record as Debt Woes Ease

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Spain's unemployment rate reached a record 26% in the fourth quarter, the latest sign of deepening recession even as growing investor appetite for the country's government bonds brings relief from the country's debt crisis, The Wall Street Journal reported. Data released Thursday by the National Statistics Institute showed the economy continued to shed public- and private-sector jobs in the final quarter of 2012 as the government worked to slash a big budget deficit. The number of unemployed is expected to grow in coming months as troubled banks close branches and lay off thousands of workers as part of an agreement to receive European Union aid. The new jobless figure illustrates how hard austerity programs are biting. Aiming to narrow its budget deficit to 4.5% of gross domestic product, from around 9% of GDP in 2011, the government has raised income and sales taxes, slowed the growth of pension payments and cut unemployment benefits. Public administrations have also been discarding workers, cutting back purchases and putting a brake on investment. Read more. (Subscription required.)