All is not well in the Balearic economy. Unemployment actually rose in August by three percent and there are now just under 16'000 people claiming benefit. The rise is more surprising considering that August is the height of the holiday season. The local government claims that growth will fall but there is no need to be alarmed. Well, the local government should be alarmed.
Unemployment figures are the best insight into the state of the economy. Any fall or increase is a clear economic reminder. The chilly winds of recession are sweeping across Europe and it appears that not even the Balearics will escape the downturn. This is quite normal of course because most of our economy depends on money brought through tourism from northern Europe.
Now is the time for caution and consolidation. The local government should be trying to help small businesses weather the storm. More relaxed opening hours is perhaps one of the proposals which should be considered. Tax breaks and other incentives would also be helpful. The plot for the summer tourist season has not read like most people expected.
British tourism rose but the number of German visitors actually declined quite sharply. Now is not the time to introduce controversial policies which will have a knock-on effect on the economy.