MADRID – The hole in Spain’s economy is getting deeper.

The government reported Friday that unemployment rose to 24.4 percent in the first quarter — compared with 22.9 percent in the fourth quarter — and that more than half of Spaniards under 25 are now without jobs.

The bleak employment came one day after ratings agency Standard & Poor’s downgraded the country’s debt.

The Spanish economy is in recession for the second time in three years as the damage from a housing bust persists. Foreclosures are rising, Spain’s banks are in worse financial shape and the government’s deficit is hitting worrisome levels.

The first-quarter employment data showed that 365,900 people lost their jobs, bringing the number of unemployed Spaniards to 5.6 million. The unemployment rate for people under 25 climbed to 52 percent.

“The figures are terrible for everyone and terrible for the government,” said Foreign Minister Jose Manuel Garcia-Margallo. “Spain is in a crisis of enormous magnitude.”

The total number of unemployed increased by 729,400 compared with the first quarter of 2011. The National Statistics Institute said Friday that Spain now has 1.7 million households in which no one has work.

The figures were another blow to the conservative government of Prime Minister Mariano Rajoy after Standard & Poor’s late Thursday became the first of the three leading credit rating agencies to strip Spain of an A rating. It cited a worsening budget deficit, worries over the banking system, and poor economic prospects for its decision to reduce the rating by two notches from A to BBB+.

S&P even warned that a further downgrade is possible as it left its outlook assessment on Spain at “negative.”

Spain, the eurozone’s fourth-largest economy, is just now just three notches above so-called junk status. The country’s problems have become the epicenter of Europe’s debt crisis in recent weeks.