The return to school has cushioned the destruction of employment in hospitality and commerce coinciding with the end of the summer season. According to data released this Tuesday by the ministries of Social Security and Labor, 18,295 jobs were created in September, while the lists of the State Public Employment Service (SEPE) increased by almost 20,000 unemployed, despite unemployment remaining at a minimum since 2008.

Social Security registered an average of 20.72 million affiliates in September, after adding 18,295 contributors compared to the previous month. With this rebound, which raises the total number of workers to the highest volume in the historical series for the month of September, the Spanish labor market returns to the path of job creation, after the destruction of more than 185,535 jobs in August. In the final stretch of the ninth month, between the 20th and 29th, there were more than 20.8 million daily members, according to the ministry directed by José Luis Escrivá.

Even so, the increase in affiliates registered in September 2023 has remained below the more than 29,200 and 57,300 added in the same period of 2022 and 2021 respectively.. On the other hand, the data for 2019 improves, when only 3,224 jobs were created. You have to go back a decade to find in the historical series declines in affiliation in the month of September, a time in which the seasonal nature of the Spanish labor market is evident. In the last year, compared to September 2022, Social Security has gained an average of 544,508 affiliates, which has represented an interannual growth of 2.7%.

Job creation has been mainly concentrated in the education sector, which has gained an average of 85,817 workers in the last month. As usual, this increase coincides with the hiring produced due to the return to school and has made it possible to cushion the destruction of employment in commerce and hospitality, where the last blows of the summer season have left 40,024 and 32,223 fewer workers respectively than in August. . The Public Administration has also lost 39,503 workers in the last month. “Never has a month of September been so devastating for public employment,” the CSIF assesses.

In parallel, unemployment has increased for the second consecutive month in September, adding 19,768 people to register a total of 2.72 million unemployed, the lowest figure for a ninth month of the year since 2008.. The second vice president of the Government and acting Minister of Labor, Yolanda Díaz, has clarified on Twitter that it is a “month in which unemployment traditionally increases”, especially due to the end of the tourist season, although the rise in This year it has been slightly higher than in 2022, when 17,679 more unemployed people were registered in the employment offices than in August. In the last year, compared to September 2022, unemployment has decreased by 219,451 people, which represents a reduction of 7.46%.

As a result of the seasonality characteristic of the Spanish labor market, the increase in unemployment in September has been limited to the services sector, compared to the declines in construction, agriculture and tourism, where the number of unemployed has fallen respectively by 3,718, 2,100 and 184 people.. On the other hand, the services sector has added 18,820 more unemployed people in the last month and the group without previous employment, 6,950.

The push for female employment

In addition, job creation has also been concentrated on women. The number of Social Security affiliates has grown in September by 59,504 contributors, coinciding with the push for education, a sector where the weight of women stands out.. On the other hand, male employment has lost 41,208 workers, thus falling to a total of 10.98 million workers, compared to the total of 9.75 million employed women in Spain.. On the other side of the coin, female unemployment has grown by 11,422 women to 1.64 million, while the rebound among men has been somewhat less pronounced, experiencing an increase of 8,346 unemployed to a total of 1,081,605. .

Along the same lines, unemployment has also grown in September among those under 25 years of age, with 17,043 more young people unemployed than in August. In total, at the end of September, there were 205,000 people under 25 years of age without a job but looking for one, the lowest figure for a month of September in the last fifteen years. As with female employment, the Ministry of Inclusion has stressed that the behavior of youth employment is being “especially positive”, having grown by 10.4% compared to 2019, before the pandemic.

Among young people, the reduction in temporary employment from 53% to 22% since the entry into force of the labor reform more than a year and a half ago also stands out.. In this sense, the Ministry of Inclusion has highlighted that the September data “clearly” reflects the positive effects of the regulatory change, since the percentage of members with a temporary contract has been reduced by half, falling to 14% in September .

According to data from the Ministry of Labor, a total of 1.39 million contracts were signed in September – 16.2% less than in the same period in 2022 -, of which 44.7% were indefinite and 55 .3% temporary. Of the total of 623,439 permanent contracts, 249,078 were full-time, while 214,192 were permanent-discontinuous and 160,169 were part-time. Social Security estimates that there are currently almost three million more members with a permanent contract than in December 2021, the last month before the labor reform came into force.

The acting Government has faith in carrying out the General State Budgets for 2024 although its approval is delayed to the beginning of next year. The Minister of Finance and Public Function, María Jesús Montero, highlighted this Tuesday that her department is already working internally on the preparation of public accounts for next year in the event that Pedro Sánchez manages to be sworn in as president in the coming weeks and form a new Government.

“Our idea is to arrive as soon as possible. It is evident that there will be a certain delay with respect to the calendar of previous years, but as long as it is approved close to the next few days of January, there is no problem with [the budgets] being retroactive,” said Minister Montero. at the press conference after the Council of Ministers. “We expect to have new accounts by 2024, but a series of elements that are not minor have to occur,” he added.

Montero recalled that the budget process begins when the Executive presents the stability objectives to the Congress and the Senate.. Precisely, the lack of this information on these objectives has raised complaints from regional and local administrations, which have had to prepare their budgets blindly, without knowing what the deficit and debt references set by the Government for these administrations are.

After setting the stability objectives, the Government must report on the spending ceiling and then the public accounts begin to be articulated.. Finally, the budget project is put to a vote in the Cortes chapter by chapter, for which it is necessary for each of them to pass by a simple majority (more yeses than noes).. In the event that the Senate vetoes a possible budget project – something foreseeable with the absolute majority held by the PP in the Upper House – the text would return to Congress, where it would need an absolute majority to lift the veto.. If that absolute majority of 176 seats is not achieved, the veto can be lifted two months later by a simple majority.

Although everything indicates that a possible budget project would not see the light until January of next year, the acting Government will have to advance the master lines of the public accounts of all the country's administrations to the EU within twelve days. The Executive has until October 15 to present the Budget Plan to the European Commission, which must include forecasts for economic growth and the evolution of public finances.

Approved the additional 0.5% increase for civil servants

In addition, the acting Government approved this Tuesday in the Council of Ministers an additional salary increase of 0.5% for public employees of all administrations.. This salary improvement is part of the agreement reached between the Executive, CC OO and UGT in October of last year to update public salaries. Public employees will already receive it in the payroll they receive this month of October and with retroactive effects to January of this year.

The pact established a salary increase of 3.5% in 2022, another of 2.5% for 2023 and a third of 1.5% for 2024.. However, in 2023 the remuneration could be raised by up to an additional 1% if inflation and nominal GDP growth reached certain levels.. As the year-on-year increase in prices in 2022 and September 2023 together have exceeded 6%, a salary improvement of 0.5% has been unlocked.

For an average public employee, a 0.5% increase in their salary will mean earning around 14 euros more gross per month (the average gross salary of public employees was 2,807 euros per month in 2021, according to the INE). In the October payroll, public employees will also receive the retroactive increase that corresponds to them in the months of January to September, so they will find themselves with a kind of 'paguilla' that can be around 140 euros gross.

Minister Montero has detailed that this salary improvement will mean a total cost for all public administrations (State, autonomous communities, local entities…) of 791 million euros. In the case of the General State Administration, the salary increase was already contemplated in the Budgets for 2023, so a regulatory change will not be necessary. Of course, the autonomies and city councils will have to address the increase “within all their powers,” said Montero.. In this sense, it is worth remembering that the agreement includes a salary increase of a maximum of 0.5%, so autonomies and city councils could opt for lower salary increases.

In addition, the Executive has also approved in this Council of Ministers the salary increases that it agreed with the lawyers of the Administration of Justice and with judges and prosecutors.. Minister Montero has clarified that the salary increases will be implemented “progressively, in different milestones at the end of this year and in the middle of next year to complete the entire agreement starting in July 2024.”

The European Commission approved this Monday the addendum to the recovery plan, the extension of the original plan with which Spain will be able to access an additional 93.5 billion euros of European funds, 90% of them in the form of loans with favorable conditions.. In exchange, the Spanish Government has committed to undertaking 18 new reforms and has agreed to 52 modifications to the plan, among them a very popular one: the commitment to introduce tolls on Spanish highways.. In this way, Spanish drivers will not have to pay to use the highways starting next year, as established in the original plan approved in 2021.

The preliminary approval of the addendum, which must be ratified by the EU Council within a maximum period of four weeks, is the starting signal for the second phase of the recovery plan. In it, Spain will be able to access 83.2 billion euros in loans under advantageous conditions (they can be repaid in 30 years and the first ten only have to be paid interest), 7.7 billion euros in non-refundable aid and another 2.6 billion to finance the REPowerEU plan. , with which Brussels intends to accelerate Russia's energy disconnection.

These additional 93,500 million are added to the 69,500 million in non-refundable transfers that have already been unlocked in the first phase started in 2021 for a total of 163,000 million. Of these, Spain has so far received 37 billion in three disbursements, that is, 23% of all funds available until 2026.

The addendum to the plan introduces 18 new reforms and introduces amendments that affect up to 52 measures in total. The new reforms were already known. Many of them develop norms that have already been approved, but whose parliamentary processing was interrupted by the calling of elections.. Others, however, develop general plans and strategies on matters such as desertification, artificial intelligence or water resources management.

The modification included in the recovery plan is developed through 52 amendments based on “objective circumstances” that justify the changes and that for the most part seek to extend the deadlines. Among these circumstances are alterations in supply chains, high inflation, lack of demand in some measures or the appearance of unforeseen legal and administrative difficulties.. Furthermore, the modifications do not affect key reforms such as pensions or tax reforms, as the Government had already indicated when it presented the draft addendum last June.

The European Commission points out that in the addendum “Spain does not eliminate or significantly reduce any investment or reform, but rather adds additional investments and reforms”. “We understand that almost all Member States will have to tweak their plan because priorities are changing, it is not something that worries us. Spain is not an isolated case,” community sources consulted by 20minutes point out in this sense.

After receiving the approval of the European Commission, the modification of the Spanish recovery plan must now be approved by the Council of the EU, which can take a maximum of four weeks. If the Council gives the green light, Spain will be able to access another 1.4 billion euros in pre-financing by the REPowerEU. Likewise, the acting Government will be able to request the fourth disbursement of the funds starting this Monday, something that the Ministry of Economic Affairs expects to happen soon.

No tolls on highways in 2024

The original recovery plan approved in 2021 included in its first component the commitment to approve a Transportation Mobility and Financing Law that would include “a payment system for use of the high-capacity road network” to cover the costs of maintenance and negative environmental externalities with a view to implementing it in 2024.

This commitment, which is now disappearing at the request of the Spanish Government, was raised before energy prices skyrocketed following the Russian invasion of Ukraine and its application had been called into question following sharp increases in road transport costs.. The Commission was aware of the difficulties in implementing this measure in a context like the current one and has agreed to replace it with a commitment to promote freight transport by rail.. An approach that is in line with the recommendations that Brussels made to Spain last May.

Brussels' decision to accept the abolition of tolls has been heavily influenced by the fact that the EU will also begin charging road transport for CO2 emissions from 2027.. From that date on, the sector will have to buy CO2 emission rights to be able to pollute, as is already the case with high energy consumption industries, commercial aviation or electricity generating and heat generation companies.

Regarding the elimination of tolls from the text, the Commission points out that the ambition of the Spanish plan remains unchanged and that the new proposal “contributes to the reduction of greenhouse gas emissions from road transport, while addressing the recommendations country-specific”.

Consumer prices have taken flight again in recent months. Since inflation hit a low last June, the CPI has risen again to stand at 3.5% in September and everything indicates that in the coming months the rise in the cost of living will continue to accelerate until the beginning of 2024. The Bank of Spain expects inflation to reach 5% again in the first quarter of 2024 and analysts such as Funcas – the think tank for the former savings banks – predict similar levels.

A good part of this “rebound” in inflation, especially the one that will occur in the last months of 2023, is due to the statistical 'base effect'. And even if consumer prices were frozen until January – something practically impossible – inflation would still remain above 3% throughout that period.

To the point that if Funcas' inflation forecasts are taken as a basis, it can be said that three quarters of the increase in inflation expected for October will be due to this statistical effect.. While in the months of November, December and January the base effect would explain 60% of the expected increase in the interannual CPI.

This 'base effect' is still a consequence of how inflation is usually measured. In the end, the CPI data that is known each month is still a percentage that reflects how much prices have risen compared to the same month of the previous year.. Therefore, the figure depends on both the prices in the current month and those recorded last year. And what happened in the final part of 2022? Well, consumer prices fell: in January 2023 they were 0.5% lower than in August 2022. This relief will, in itself, cause inflation data in the coming months to be more unfavorable.

To this we must add that, unlike what happened in the final stretch of 2022, this year price increases are expected to occur between August and January.. Last year, energy prices plummeted in international markets, once the fear of shortages had been overcome and also thanks to the Government's support measures.. However, the final stretch of 2023 is being characterized by a rise in prices in the energy component that comes mainly from the oil side.

Anyone who drives regularly will have noticed: gasoline now costs 10% more than before the summer holidays and diesel costs 18% more than before the summer holidays.. The cuts in oil production promoted by OPEC+ are pushing up crude oil prices around the world, which especially harms importing countries such as Spain.

Uncertainty over support measures

After a winter in which inflation will rebound, the consensus is that from the spring of 2024 it will gradually return to the fold. However, the outlook for next year is surrounded by unknowns.. The first and most immediate regarding inflation will be what happens with the support measures.

The uncertainty surrounding the formation of the Government in Spain makes it difficult to predict what will happen with the support packages that the current acting Executive has been approving in recent months and that will expire with the arrival of the new year if nothing prevents it.. The acting first vice president and Minister of Economic Affairs, Nadia Calviño, said last Monday that she does not rule out extending some of the measures currently in force if the governing coalition manages to renew its mandate.

The 2024 inflation curve will depend on whether or not there is an extension of the support measures and, if so, which ones.. Analysts have prepared their forecasts under the premise that the energy aid package – which includes the entire tax reduction on the electricity and gas bill or the 'Iberian exception' – will not be renewed.

Not extending the measures would cause an automatic rebound in energy prices, which would grow up to 25% year-on-year in spring, according to estimates by the Bank of Spain. However, in the second half of the year it would allow inflation to return to its objective and stabilize price increases once and for all.

At this point, the reaction of households and companies to a possible withdrawal of the measures seems key.. If increases in energy prices are passed on again to the rest of the products, as happened with the initial energy shock, inflation—especially core inflation—will take longer to fall.

On the other hand, higher energy prices would further suffocate Spanish families, who have already endured the Euribor slab for months, which has skyrocketed the mortgages of four million homes.. If households cut their consumption further, companies will end up being forced to cut prices. This would cause a faster decline in inflation, but it would also have consequences on the growth of the economy, which would be penalized.. In favor of households, the drop in inflation that occurred in 2023 will allow them to recover some of the purchasing power lost in 2021 and 2022.

October brings good news for civil servants: Starting this month, they will receive an extra increase in their payrolls following the 'Framework Agreement for a 21st Century Administration' between the Government and unions.

This additional increase has been activated after knowing the advanced inflation figures for the month of September, with an annual variation rate of the IPCA of 3.2%. Now, the Council of Ministers must approve the application of this increase and subsequently publish it in the Official State Gazette (BOE), so that, then, public employees see it reflected on their payrolls.

How much is the rise?

The salary increase will be 0.5% and will be applied retroactively from last January. The agreement indicates that employee payrolls would increase by a fixed 2.5% in 2023, with the possibility of two variable increases, of 0.5% each.

More than 3 million beneficiaries

The beneficiaries of these salary improvements will be all public employees of the state, regional or local administration.. There will be more than 3 million people who will receive this payment.