The impact of the labor reform to fight against temporary employment in Spain stopped in April, when the volume of temporary hiring hit a minimum. In the fourth month of the year, the weight of temporary contracts with respect to the total fell "rapidly from January to 52% in April, 38 points less than in April 2019," according to the Quarterly Labor Market Observatory, prepared by the EY-Sagardoy Institute for Talent and Innovation, BBVA Research and Fedea. From those lows there has been "a seasonal rebound to 60.5% in August 2022." It's 10 more points.
The future outlook described in the report is negative, since "job creation lost momentum in the second quarter" both in terms of the number of employed persons and hours worked. "The Social Security affiliation data for July and August anticipate a stagnation in the number of contributors in the third quarter, once the effect of seasonality has been discounted," adds the Observatory.
The biggest problem for the labor market is that taking certain indicators such as "effective hours worked or full-time equivalent jobs, they still remained below pre-pandemic levels." It has not been possible to overcome covid.
In relation to the unemployment rate, it fell to 12.5% in the second quarter and was at its lowest since 2008. "However, the incidence of long-term unemployment increased again," the authors of the report clarified. .
The latest statistics also show a worsening of temporary contracts, which are getting shorter and shorter. One possible explanation is that after the labor reform, the remaining temporary contracts are precarious jobs. In August, the average duration of the contracts was 39 days, five less than last year and six less than in December. The USO union explained in a recent report that in August there were "more permanent contracts than people have signed them." This implies that 23,000 workers "have been the subject of more than one indefinite contract" because they have multiple jobs or because their contract has been terminated and they have been rehired, the union added.
The Observatory report also highlighted that the increase in the number of wage earners in the private sector and the self-employed offset the loss of employment in the public sector.
