Spanish reform talks fail, borrowing costs rise

Spanish unions and employers failed to agree on labor market reforms deemed crucial for resurrecting the economy and allaying jitters over its public finances, the government said Thursday as wary investors again sent its borrowing costs soaring.

The failure of the 11-hour negotiation that broke up just before dawn means the government will now propose its own plan for changing the rules that govern Spain's labor market.

The negotiations were aimed at creating consensus on reforms to encourage companies to hire, resurrect an economy saddled with a 20 percent jobless rate and reassure markets that Spain can trim its heavy deficit and debt loads.

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