Slumping Spain shifting from low-skilled industries

06/12/2008 | Reuters

A building boom that last year made Spain one of Europe's star economies is forecast to fall 70% this year and cost 1 million jobs by next year. The International Monetary Fund expects to see years of stagnation until a needed economic transformation is complete. Spain's growth relied on cheap credit and low-skill labor, said economist Rafael Pampillon of Madrid's Instituto de Empresa business school. With one of Europe's lowest education levels and labor costs as high as Germany's, Spain has not shifted to the high-skill industries it needs to compete in a global economy, Pampillon said.

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