The second quarter EPA reveals an unprecedented decrease in the number of temporary workers
The Active Population Survey (EPA) of second quarter of 2022 leaves the first photograph of the impact that the labour reform in the Spanish labor market. The main objective of the rule agreed between the Government, employers and unions was to reduce the high casualty rates that the Spanish labor market has been dragging for decades. The new hiring formulas entered into force last April and during the first three months of application the rate of temporary employment has experienced an unprecedented drop.
Temporality: historical fall
The first three months of labor reform have achieved an unprecedented effect: that temporary employment falls while employment continues to rise. Until now, the number of casuals has had moments of decline, but they have always been linked to periods of crisis and employment contraction. In other words, the number of storms decreased because these were the most cheap and easy to dismiss by the companies and when lean cows came the directions ceased to them before resorting to you. The most recent episode is when the pandemic. In the early stages, thousands of workers went on the dole and almost all of them were temporary, since the permanent ones became Goodbye.
In this second quarter there has been a positive balance in the creation of employment of 375,400 employees, which comes from adding 616,700 employed with an indefinite contract, while temporary contracts are reduced by 241,300. Which leaves a contingency rate of 22.3%, almost two points lower than in the previous quarter. The positive note does not hide the fact that Spain still has a long way to go to converge with European statistics and that is that the average in the EU is around 15% and Spain continues to be the country with the highest temporary employment on the Old Continent.
Young people remain tied to temporality
The first three months of the labor reform in full force have had a substantial impact in general terms, but they have not been able to curb temporality among one of the groups that suffer the most: the youths. Between the under 30 years old the 47.2% They still have a temporary contract. Yes, it has dropped 4.6 points compared to the previous quarter, but it is still very high and substantially higher than among other age groups. The unknown now is what path this statistic will mark in the coming months and whether young people will be able to continue growing in employment indefinite or not.
The eventuality rises in the public sector
The contracting rules of the labor reform govern the sector privatebut not in the public. And this has had an effect during this second quarter of 2022, in which the gap between wage earners in the Management and the private company has increased up to 10 points. In the private sector, temporary employment has fallen to 19.8%, while in the public sector it has grown and stands at 32.4%.
The process that the Government has designed to reduce the eventuality in the Administration goes another way and is the new stabilization law. This enables the different administrations – the eventuality is concentrated in the services managed by the autonomies – to convene merit-based competition processes to permanently cover hundreds of thousands of places currently occupied by interim already with permanent staff. And without these having to go through an opposition, only accrediting previous merits. It is expected that these processes will end up closing during the final part of the year.
The reform does not trigger bias
One of the possible collateral effects of the new hiring formulas was that they would trigger partial contracts. Especially given that the reform encourages the transfer of temporary contracts to discontinuous fixed (which have the category of indefinite). During the first three months of validity that has not happened, as the statistics reflect. The partiality rate has decreased compared to the previous quarter, falling from 14.9% in the previous quarter to the current one 14.7%. Last year for this same period it was 15.3%, five tenths more than the current one.
This indicator may be subject to fluctuations in the coming months and the unknown is how it will evolve. Well, now whoever is being hired permanently – taking into account that the discontinuous permanent employees of the hospitality and commerce industries will be mostly at full activity for the spring and summer campaigns – is hired full-time.
Lower temporary employment in agriculture and services
The sectors where the eventuality has decreased the most in the first three months of the labor reform have been services Y farming, although the rates of temporary contracts have fallen across the board. In services the eventuality has fallen almost five times more in the second quarter (with the labor reform already fully in force) than in the previous quarter. In the case of agriculture, the decline has been almost twice as bigMeanwhile in industry Y building it has dropped practically the same as this indicator dropped in previous months.