MADRID – Since 2008, the number of unemployed in Spain has not fallen as much as in November. Last month, more than 74,000 more people were employed than in October. Unemployment has been falling for nine months in a row, which has never happened in Spain before.
Also, never before have so many premium payers been registered with the Seguridad Social (19,752,358). Furthermore, no fewer than 282,981 permanent employment contracts were signed in November. This year, a total of 730,000 premium payers were added, which is an average of 2,000 per day. The record numbers for November are particularly noteworthy because this is normally a bad month for employment. Usually, it is the calm before the storm in December, when large-scale workers are again recruited.
More premium payers than before the pandemic
The sectors benefiting most from falling unemployment are agriculture (down 3.89%), industrial (-2.91%), service sector (-2.11%) and construction (- 1.70%). With a total of more than 2 million employment contracts signed in November (of which more than 280,000 permanent contracts), there are now more premium payers registered with the Seguridad Social than before the start of the corona crisis.
A more realistic picture of the labour market with fewer ERTEs
The number of employees for whom an ERTE temporary unemployment scheme is in place is also decreasing. Of the 3.6 million temporarily unemployed in April 2020, 126,632 were left last November. That is the lowest number since this work protection mechanism went into effect last year. Now that this group of temporarily unemployed has become considerably smaller, the registration figures at the Seguridad Social also provide a better picture of the actual unemployment. After all, employees with an ERTE scheme continue to be registered as premium payers with the Seguridad Social, as a result of which there used to be a more favourable picture of the labour market than was actually the case.
Raising minimum wage has not cost jobs
The increase in the statutory minimum wage (SMI) has ultimately not had a negative effect on employment, as predicted by the Spanish employers’ association CEOE and the Spanish Bank. The forecast was that the wage increase would lead to a reduction in the number of new employment contracts. Since the increase in the SMI in September, there have been no increasing job losses for the time being.
However, the upturn in employment is in stark contrast to current forecasts for the economy in Spain. Recently, the Organisation for Economic Co-operation and Development (OECD) adjusted the expected economic growth in 2021 from 6.8% to 4.5% and for 2022 from 6.6% to 5.5%.