The NTC Spanish Purchasing Managers Index (PMI) reports that the manufacturing sector grew at its slowest pace in 27 months and found firms cutting staff. NTC economists said the outlook was bleak for Spanish manufacturers as they were eating their way through backlogs and stocks of finished goods piled up as new orders failed to make up for products already on the production line. "Although the PMI is not the lowest (in the Eurozone), a lot of indicators are consistent with an increasing rate of decline in the future," according to NTC Chief Economist Chris Wilson.

Performance and hiring by the agricultural sector continues to decline as well. And real estate -- which has added much value to the Spanish economy through housing appreciation -- has been hit by the global credit crunch. The Spanish housing market is being enveloped by oversupply and falling property sales. In addition, the housing market is overvalued by around 35 percent according to the latest estimates from the Bank of Spain. Problems in the Spanish property market will have a wide impact on other markets – especially construction and service businesses. It has been estimated that as many as three million workers are employed in businesses (legal, banking and retail) dependent on the Spanish property market.