Spain closed a record 2023 in terms of business creation employment. The labor force survey (EPA) published this Friday confirms what the affiliation data had been indicating month after month and that is that employment has registered, on average, one of its largest increases in the available statistics. In parallel, the unemployment has fallen, although the large increase in the population willing to work has diluted its records and the decrease in unemployment has been substantially less than the increase in employment.
Migrants have been the main protagonists, in an exercise that also has, in that sense, a woman’s face. The question now is whether, as happened in 2023, 2024 will also be able to improve expectations of a slowdown in employment.
Record employment: migrants pull affiliation
If 2023 has closed as one of the best years in terms of gains in active workers, it is thanks to the prominence that people born outside of Spain have had. Never before has the weight of foreign affiliation in new jobs created been so high, to the point that four out of every 10 new jobs created have been occupied by migrants. In Catalonia, this trend has been confirmed more pronounced, with the proportion reaching six out of 10, that is, more than half.
Employment is growing and the active population is growing because during the year those expectations that more jobs were going to be created have been fed and sustained. And it has been confirmed. Spain closes 2023 with 783,000 employed more than in 2022, a record balance that does not hide a certain weakening in the final stretch of the year. Which allows us to reach a maximum of 21.2 million active workers during the fourth quarter.
The authorities do not deny that the deceleration is evident and that the prospects for next year are less intense in terms of job creation. Without entering into a scenario of stagnation and, far from it, destruction, but the gains will be more discreet. And, contrary to some predictions, the group of self-employed has grown almost at the same rate as the number of employees.
Unemployment: the lowest rate since 2007
This intense job creation has contributed to Spain closing 2023 with the lowest unemployment rate since 2007, just before the financial and real estate bubble burst. The national comparison is good, but not the international one, since the Spanish unemployment rate continues to be the highest in the entire European Union. In Spain the rate is 11.7% and the European average is in 5.9%.
Another bittersweet fact is that in 2023 the number of households with all members unemployed was reduced, but they are still above one hundred thousand, specifically 115,100 throughout the country.
The number of unemployed stood at 2.8 million people, some 193,000 less than a year before. Which allows Spain to score the goal of closing, for the first time in 16 years, a year below the symbolic level of three million unemployed.
More hours worked… but more partiality
The economy has more employees and the total volume of hours they work said busy is on the rise. It is also higher than before the pandemic. During the last year, the total number of hours worked, an indicator that is usually used to measure the degree of vitality of the economy (since the more work, the better growth prospects), has increased by 3.3%. At a faster rate than GDP is growing, which during the third quarter of 2023 – latest data available from the INE – advanced at 1.8%.
And, compared to the pandemic, the total number of hours is currently 1.7% higher than what was done then. There are strategic sectors, such as the manufacturing industry or commerce, that are still far from the volume of work they had then, but in general terms the number of hours worked has recovered.
However, the number of hours a person works on average per week is decreasing. What has historically been associated with worse working conditions, since the main reason for lack of income is not so much the salary, but rather wanting to work more hours to have more income and not being able to do them. Currently the average working day – counting people who work full time and those who work part time – is 31.7 hours per weekwhen before covid it was 33.8 hours. Furthermore, there is a gender gap to the detriment of women.
More stability in hiring
The effects of the labor reform are noticeable, above all, in the higher levels of employment stability. According to data from the Ministry of Social Security, there are now more than 3.1 million more affiliates with Indefinite contract than in December 2021, the last month before the reform comes into force. Thus, in December, the percentage of members with a permanent contract stood at 86%, its historical maximum, growing 16 points since the labor reform. And the temporary rate remains at a minimum (14%). In the case of the under 30 years oldthe reduction in the level of temporary employment is more intense, falling by 31 percentage points (from 53% to 22%) compared to the level it had before the reform.
The effects of the labor reform are also noticeable in the evolution of the temporary employment rate. In the private sector, fiscal year 2023 closed, the second year of the new labor reform, in which 13.2%, a historic low. To put it in perspective, before the bubble burst, the proportion of temporary workers was 32%that is, almost one in three workers was certain that sooner or later they were going to lose the job they had.
However, Rome was not built in a day and the high rates of eventuality They resist disappearing among certain groups. The best youths They still have a large room for improvement in terms of stability. Four out of every 10 people under 25 who have a job have a temporary contract. The proportion has decreased in the last two years, but is still very high.
Catalonia leads job creation
During 2023, Catalonia created more jobs than ever, with permission from 2005, something statistically flawed by the regularization of variables to harmonize them under European criteria. A boom shared with the rest of Spain (3.8% year-on-year), but more intense in the Catalan case (5.6%).
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In the comparison between the two economic engines of the country, Catalonia it comes out better than Madrid, although it also recorded good numbers (5%). While 197,600 jobs were created in the first territory, in the second, employment increased by 160,500. Employment growth has been practically unanimous during the global 2023, except for The Rioja (-1.8%) and Castile and León (-0.4%) where there has been a decline.
Regarding unemployment, Catalonia remained the fourth autonomous region with the lowest unemployment rates (9%), only surpassed by Aragon (7.8%), Cantabria (7.5%) and Basque Country (6.3%). The community with the highest unemployment rates in 2023 in all of Spain was Andalusiawith 17.6%.