• Income levels recover before the crisis after almost four years of growth
  • The acceleration of GDP allows a favorable growth differential to be maintained compared to the euro area average
  • The contribution of national demand improves and the positive contribution of the foreign sector remains for the fifth quarter
  • Employment accelerates three tenths and grows at a rate of 2.8% in the last twelve months

The Spanish economy is chaining almost four years of growth after increasing GDP by 0.9% in the second quarter and 3.1% in the last twelve months, according to National Accounts data published by the INE. The data represents an acceleration of one tenth both in annual and quarterly rates, which maintains a growth differential favorable to Spain in relation to the euro area average. It is a balanced growth, with an improvement in the contribution of national demand, while maintaining the positive contribution of the foreign sector for the fifth consecutive quarter. Employment grows at an annual rate of 2.8%, three tenths more than in the first quarter, which means the creation of 480,000 full-time equivalent jobs in the last year.

With these results, the Spanish economy recovers the income level prior to the crisis in the second quarter; that is, since the maximum reached in the second quarter of 2008. In relation to the end of 2007, the GDP amounts to 1%, although it has yet to recover what has stopped growing during the five years of recession in the Spanish economy, between 15% and 20% more. The rhythm of 3.1% in the second quarter means accelerating this process and ensures that the forecast of 3% as an average for the year will be easily reached. The positive differential of Spain with respect to the average of the European Union and the euro area, which registered growth of 2.3% and 2.2% in the second quarter, respectively, is also maintained.

The composition of growth remains balanced, with a slight improvement of one tenth in the contribution of national demand, which reaches 2.4 percentage points. The growth of household consumption has remained at 2.5% in the last twelve months and investment continues as the most dynamic component with growth of 3.4%, although it slowed half a point. Within investment, capital goods investment is also the most active, with growth of 4.1% in the last year, 1.3 points less than in the first quarter. The growth rate of construction investment increases one tenth, to 3% in the last year.

External demand maintains the contribution to economic growth at 0.7 points, which adds up to five consecutive quarters in positive. Despite the strong growth of the Spanish economy, the foreign sector does not detract from growth, but on the contrary. This is a fact that had not occurred in the Spanish economy in previous stages of growth, reflecting that the current model is sustainable and balanced. Both exports and imports slow down around three points, although sales of goods and services abroad grew more strongly (4.5%) than imports (2.8%).

Virtually all economic growth is transferred to employment, which has grown by 2.8% in the last twelve months. This rate represents an acceleration of three tenths compared to that registered in the first quarter of this year. Job creation is estimated at 480,000 new full-time equivalent jobs in the last year. The number of hours actually worked continues to increase, 1.7%, one tenth less than the previous quarter.

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