The Spanish economy fell by 0.5% in the first quarter of the year, thus returning to negative values after having recorded rates of 17.1% and 0.0%, respectively, in the third and last quarter of 2020. The third wave of the pandemic, the stoppage caused by the storm surge and the delay in vaccines have caused this drop in GDP in the first three months of the year.
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According to the advance of National Accounting data published this Friday by the National Statistics Institute (INE), the Spanish economy fell by 0.5% between January and March due to the decrease in consumption and investment.
However, at a year-on-year rate, GDP fell in the first quarter at a much lower rate than it did in the fourth quarter of 2020. Specifically, the Spanish economy contracted by 4.3% year-on-year, compared to the fall of the 8.9% experienced in the previous quarter.
With this year-on-year contraction of 4.3%, the lowest since the first quarter of 2020, five consecutive quarters of negative year-on-year rates have already accumulated.
Domestic demand subtracted 2.6 points from year-on-year GDP, 3.6 points higher than in the fourth quarter of 2020, while external demand had a negative contribution of 1.6 points, 1.1 points more than in the quarter previous. Household final consumption expenditure experienced a decrease in the interannual rate of −4.0%, 5.4 points more than in the previous quarter.
At current prices, GDP fell 3.3% year-on-year, a rate 4.9 points lower than that registered in the fourth quarter of last year.
Although exports of goods and services fell by −9.5% compared to the first quarter of 2020, it must also be taken into account that they grew 6.8 points more than in the previous quarter, confirming the recovery of the foreign sector and its contribution to the economy.
Employment in terms of hours worked decreased 2.0% compared to the previous quarter. Full-time equivalent jobs grew 1.4%, which is two tenths more than in the fourth quarter), due to the reduction observed in average full-time hours (−3.4%).
In interannual terms, employment shows a variation of −1.9%, which represents a decrease of 343,000 full-time equivalent jobs in one year.