Balearic economy will create 36,000 new jobs this year and next

Balearic economy will create 36,000 new jobs this year and next

The Balearic economy adds and continues. Not only has it managed to leave behind the crisis, but it will be the one that grows the most in 2018 in Spain, according to the forecasts of the BBVA analysis service In the presentation of its annual report to the media in Palma, the bank’s chief economist for Spain and Portugal, Miguel Cardoso , augured yesterday that the Balearic Gross Domestic Product (GDP) will grow this year by 3% and in 2019 it will increase in 2.6%, the second community with more momentum, only behind Madrid.

Last year, according to the data of the entity, the economy of the archipelago grew by 4.1%, 1 point more than that of the whole of Spain and 1.4 points above the average of the last 35 years. Some forecasts that, if fulfilled, will have a very positive impact on employment, with a growth of around 3% per year and a creation of new jobs that could reach 36,000 in the two years (2018 and 2019), until the unemployment rate at the end of 2019 at 7.1%.

However, there are also clouds on the horizon. The BBVA predicts a slowdown in the island’s economy “in the coming quarters” and blames it on several factors. After years of strong growth in the influx of foreign visitors to hotels, this circumstance “could begin to show symptoms of exhaustion”. To which must be added the “contagion effect of the Catalan uncertainty”, which, in the bank’s opinion, could mean “lower growth of between two and three tenths” for the Balearic GDP this year. In addition, the entity also observes deceleration symptoms in indicators such as consumption.

According to Cardoso, the political uncertainty for the Catalan independence movement “has not had such a negative impact” when compensated by the “favorable global environment”. The loss of growth of 2018 in the Catalan GDP attributable to the political tension, expected at 0.7 points, will have an impact on the Balearic Islands of about 0.3 percentage points. This does not mean that BBVAResearch demands urgent measures “that facilitate the improvement of productivity and that allow us to continue improving the competitiveness of the economy to avoid a stagnation in productivity”.

As for the rest of the islands, “Ibiza and Formentera begin to show signs of exhaustion after the pace of previous years, and Mallorca takes the lead in creating jobs in 2017,” details BBVA, which attributes the upward trend in employment to Services and construction sector. Also, it is highlighted in the analysis that last year public investment and consumption stimulated the economy, although this last factor will be attenuated after 2018, partly because many citizens have already made the expenses they had avoided for fear in the years of the crisis.

Finally, the bank warned of the need to promote training policies that reduce inequalities among workers.