Temporary jobs lift Spanish gloom

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Spain is still facing a jobs crisis. Nearly 35,000 people applied for 200 health care positions when they were advertised last November.

One of Europe's hardest hit economies is finally catching a break on jobs: The number of Spanish workers registered as unemployed fell by 107,600 last month, the best result for December on record.

On a seasonally-adjusted basis, the decline was 57,645, marking a fifth consecutive decrease, according to a government report Friday.

The eurozone's fourth biggest economy slumped after a housing bubble burst and many of its banks required hefty bailouts.

The Spanish government began a program of austerity to control its budget deficit and implemented structural reforms aimed at improving productivity. Exports have recovered as a result, helping to stabilize GDP in the third quarter of 2013 after years of recession.

Prime Minister Mariano Rajoy has predicted a recovery in 2014. And in a radio interview earlier this week, Economy Minister Luis de Guindos said job creation could beat government forecasts.

But labor unions say most of the jobs being created in Spain each month are part time and temporary, with a third providing less than four hours work a day.

Some 92% of new employment contracts last year were temporary, and the number of permanent jobs being created has been in decline for 12 months.

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December's upturn in employment provides more evidence that Spain, and the eurozone, is over the worst of the crisis. Still, the lack of permanent jobs will make it harder for the country to revive domestic demand, and economists say it's too soon to say whether the improvement in the labor market will continue.

Europe poised for rebound in 2014
Europe poised for rebound in 2014

"Employment in Spain has traditionally only seen sustained increases when the economy has posted solid growth; it remains to be seen whether this will also be the case this time around," noted Victor Echevarria at BNP Paribas.

Spanish GDP rose by 0.1% in the third quarter, compared with the second, but was still 1.1% down on the same period of 2012.

The government expects GDP to have declined by 1.3% in 2013. It is forecasting growth of 0.7% this year, and 1.2% in 2015.

With some 6 million people out of work, Spain's unemployment rate of more than 26% is still the second highest in the European Union. Only Greece is in worse shape.

-- CNN's Al Goodman in Madrid contributed to this article.

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