The Spanish GDP Fell by 0.5% Between January and March
The Spanish economy contracted again in the first quarter of the year after the Gross Domestic Product (GDP) fell by 0.5% between January and March with respect to the data registered in the last three months of 2020, complying with the forecast that Some of the main GDP of the country’s economic health were advancing and that led the Government to reduce the growth forecast for this year by seven tenths, to 6.5%.
Specifically, according to the advance of National Accounting data published this Friday by the National Institute of Statistics (INE), the Spanish GDP registers a quarterly variation of -0.5% in volume terms as a consequence of the decrease in consumption and investment.
Regarding the year-on-year change in GDP, this stood at -4.3% (the lowest contraction since the first quarter of last year), a decrease at a much slower rate than in the last quarter of 2020 (-8, 9%) but that already adds five negative.
The contribution of national demand to year-on-year GDP growth was -2.6 points this quarter, 3.6 points higher than in the fourth quarter. Specifically, consumption fell by 0.6% in the first quarter due to the return to negative rates of household consumption and non-profit institutions serving households (NPISHs), which showed decreases of 1% and 2.1% until March, compared to the 0% and 0.6% rates of the previous quarter.
Of consumer spending, only public spending remained positive during the first quarter, with growth of 0.5%, its lowest in two years after growing at a rate of 1.3% in the two previous quarters.
Investment also returned to negative values and also after two quarters of progress. Specifically, between January and March, investment contracted by 1.9%, compared to the growth of 1% in the previous quarter and the historical increase of 21.5% that it experienced in the third quarter of 2020.
In the same line are the results of exports and imports, which presented negative rates of 0.1% and 1.3% until March after having registered advances of 4.6% and 6.2% in the last quarter of 2020.
External demand presented a contribution of -1.6 points, 1.1 points more than in the previous quarter.
The number of hours actually worked decreases by 2%
Regarding the compensation of employees, this presented a year-on-year growth of -3% in the first quarter, 1.5 points higher than the previous quarter as a result of a year-on-year evolution of -3.1% in the number of wage earners ( 2.2 points more than the previous quarter), and that the average remuneration per employee varied 0.1%, compared to 0.8% in the fourth quarter.
Also in the workplace, the number of hours actually worked decreased 2% compared to the fourth quarter, 3 points less than in the previous quarter. In year-on-year terms, the number of hours actually worked increased 2.5 points, to -3.6%. Productivity per hour actually worked fell 0.7% year-on-year in the first quarter, leading three down.
The Labor Force Survey (EPA) for the first quarter published on Thursday already foreshadowed the impact of the decrease in effective hours worked as a result of the coronavirus on GDP.
By sectors, the interannual variation rate of the hours worked in the industrial branches stood at -6.5%, four tenths more than in the previous quarter, while in Construction, the interannual variation was 0.8% , with an increase of 5.4 points compared to the previous quarter.
The hours worked in the Services sector increased 2.4 points in their interannual variation compared to the previous quarter, to -3.9% and in the primary branches they presented a variation of 1.3%, with an increase of 2.7 points with respect to to the previous quarter.
The INE has warned that the data advance has been prepared with the information available up to February and with some results advanced to the month of March, so that, in order to confirm the GDP, the revision may have a “greater magnitude than usual “, with a greater difference between advanced and confirmed GDP.