The Spanish economy will shrink by around 1.5 percent this year as a contraction that began last quarter deepens, Economy Minister Luis de Guindos said in an interview published Sunday.
"The first quarter of the year is going to be hard, even harder than the last quarter of 2011, with a decline in GDP of more than 0.3 percent. I think the second quarter will also be negative," he told daily newspaper El Pais.
"The government believes that the economic contraction this year will be around the 1.5 percent which the Bank of Spain has estimated," he added.
Gross domestic product (GDP) declined 0.3 percent in last quarter of 2011 from the previous three months, the first such contraction since the end of 2009, official data showed last week, as Spain slipped towards its second recession in two years.
Over the year as a whole, GDP rose just by 0.7 percent in 2011.
Last month the Bank of Spain predicted the economy would contract by 1.5 percent in 2012, before posting a modest recovery of 0.2 percent in 2013.
The central bank had previously estimated in March that the economy would expand by 1.5 percent this year.
The International Monetary Fund has forecast a deeper contraction of 1.7 percent in 2012 and a further decline of 0.3 percent in 2013.
Spain emerged only at the start of 2010 from an 18-month recession triggered by a global financial crisis and a property bubble collapse that destroyed millions of jobs and left behind huge bad loans and debts.
The country's jobless total hit 5.27 million people at the end of 2011, pushing the unemployment rate to 22.85 percent, the highest level among members of the Organisation for Economic Cooperation and Development.
De Guindos called the Spain's unemployment rate its "greatest social scourge".
"This is why the government's top priority is to strengthen hiring. Everything has to be focused on ensuring that in Spain, people are hired once again. The creation of jobs has disappeared," he added.
Spain's new right-leaning Popular Party government is struggling to slash a bloated public deficit and revive growth to avoid being dragged back to the centre stage of the eurozone debt crisis.
A recession and more jobless people make it harder to balance the books because the state must pay more in unemployment benefits while receiving less income from taxes.
The government plans to introduce a draft reform of the country's labour laws later this month as part of its agenda to repair the damaged economy.