The labor market evolved positively in July, especially when compared to the same month last year. Membership rose by almost 22,000 workers and unemployment fell by nearly 11,000 people. But employers, unions and many economists see a certain slowdown. Perhaps the bad data recorded in Catalonia with an increase in unemployment are a preview of what is to come in Spain as a whole.
"Membership data certainly confirms the slowdown: if a comparison is made with the most recent expansion years (2014-2019), excluding those of the post-covid recovery, yesterday's data showed growth in employment at half the pace of that period", warns David Tinajero, AFI analyst. "And the same happens with the rate of reduction in registered unemployment and in seasonally adjusted terms". Along these same lines, the employers' association CEOE warned that the drop in unemployment of 10,968 people is far from the historical average of 41,023.
The most serious consequence of this slowdown is already impacting with all its harshness in Catalonia, where unemployment grew by 1,612 people, while membership rose by 10,931 workers. Javier Pacheco, general secretary of CC.OO. Catalonia believes that the bad unemployment data is due to the fact that "we are at the limits of our productive model" and that without changes it will be difficult to continue cutting the number of unemployed.
And in Spain, is the reduction in unemployment close to the ceiling? "There is a very important element: little by little we are colliding with the limits of demographics", answers Raymond Torres, director of the situation at Funcas. Ángel de la Fuente, director of Fedea, says that "I don't see much more room to continue lowering unemployment".
A recent report from San Pablo University-CEU asserted that between the first quarter of 2022 and 2023, 95% of new jobs had been filled by immigrants, and Funcas warned that the average age of workers it had been delayed six years (until 43 and a half) due to a lack of workers.
In Spain as a whole, the labor market is at record levels for the last fifteen years. Employment – measured as average affiliation to Social Security – exceeds 20.8 million workers. In the case of the unemployed, the figure of almost 2.7 million is the lowest since 2008.
Torres also points to two factors that could influence the July data. The first is that of a possible change in seasonality that changes when employment is created and destroyed. The second - adds Torres - is the role played by the figure of discontinuous permanent jobs, which have soared with the labor reform.
What does not change are some characteristics of employment in July. More than 110,000 education jobs were destroyed this month. The end of classes in June probably caused many teachers and other teaching staff to lose their jobs. Instead, the fall in employment was largely offset by hiring in seasonal sectors such as hospitality, which gained more than 23,000 members, or the 41,000 in commerce. So, the services have 16.07 million members.
The Balearic Islands, dependent on services and tourism in the summer season, leads the employment gain, with 12,912 employees ahead of Catalonia (10,931) and Galicia (10,898). In Madrid, with 18,132 less contributors, it is where it falls the most.
From the Ministry of Labor it is highlighted that "unemployment has fallen by 205,938 people in year-on-year terms" and that "unemployment among women stands at 1.61 million, the lowest value in 15 years". In July, unemployment fell "almost universally", with a drop of 7,126 people in services, 1,861 in agriculture and 964 in industry. In construction, it goes up by 1,186 people.
By region, unemployment fell in ten regions, with Andalusia (-5,166), Madrid (-2,926) and Galicia (-1,579) leading the way.
In a statement, the UGT highlighted the "exceptional" employment results, thanks to the labor reform.
