Spain's ruling Socialists suffered a crushing defeat to conservatives in local and regional elections, yielding power even in traditional strongholds against a backdrop of staggering unemployment and unprecedented sit-ins by Spaniards furious with what they see as politicians who do not care about their plight.

Prime minister Jose Luis Rodriguez Zapatero said the result was due punishment of his government for the state of the economy - the jobless rate is a eurozone high of 21.3%.

But he said he had no plans to move up general elections, which must be held by March of next year, and pledged to press on with job-creating reforms despite the loud outcry of opposition to his party.

The win for the conservative opposition Popular Party puts it in even a stronger position to win the general elections and return to power after eight years of Socialist rule.

In what Spanish media said was the worst performance on record by the Socialist Party in local and regional elections, the numbers reflecting the loss were stunning.

The conservative Popular Party won at the municipal level by about two million votes, compared to 150,000 in its win in 2007, and in 13 regional governments that were up for grabs, Mr Zapatero's party lost in virtually all of them.

One was Castilla-La Mancha in central Spain, where the Socialists have always held power.

The Socialists also lost bastions like the town halls in Barcelona and Seville. The conservatives padded their majorities in Madrid and Valencia, in the latter even though the president is under investigation for corruption.

Several other Socialist-controlled regional governments also fell. Spain's electoral map turned largely blue - the colour of the Popular Party.

Mr Zapatero attributed the results to the state of the economy, which is struggling to shake off nearly two years of recession, and conceded many Spanish families are suffering.

But he did not mention snowballing protest rallies that have riveted Spain for the past week and filled squares in Madrid and other cities. Organisers voted yesterday to keep at it another week at least.

"It is reasonable to expect that the Socialist party be punished today at the polls. We accept this and we understand it," Mr Zapatero said at a gloomy Socialist Party headquarters, flanked by top ministers including Finance Minister Elena Salgado.

She has spearheaded government efforts to prevent Spain's bloated deficit and shaky banking sector from dragging Spain further into the European debt crisis and need a bailout like Greece, Ireland and Portugal.

The Socialists had widely been expected to do poorly.

But one surprise did come in the Basque region, where a nationalist coalition called Bildu - which includes candidates whom police had linked to the banned political wing of the armed separatist group ETA but were allowed by Spain's highest court to run anyway - had won a significant number of seats in the town halls of three of the region's provincial capitals.

ETA declared a permanent cease-fire in January. Critics did not want Bildu to be allowed to run and will now complain that ETA has retained a voice in Spanish politics.

As results were tallied and afterward, merry crowds gathered outside Popular Party headquarters in Madrid, while virtually no one was outside the Socialist headquarters.

The election came against a backdrop of widespread discontent.