A record of affiliates with shadows: employment slows down, fewer women work… and teachers still suffer from the summer break

Spain chains five consecutive months setting employment records. The number of affiliates to Social Security increases month by month, at the same time that unemployment explores the reverse path, reaching its lowest levels in the last fifteen years. Both sides of the coin reflect the prosperity of the job market in Spain, although not everything is bright. there are also shadows. In recent months, job creation has slowed down, which raises the question of how long the number of workers will continue to grow. In fact, affiliation to Social Security has already fallen in July among women and the foreign population.

More workers, more income

According to the data published this Wednesday by the Ministry of Inclusion, affiliation to Social Security accumulates 16 months above 20 million workers, after already exceeding in October 2021 the maximum number of contributors registered before the pandemic in July 2021. 2019. Since then, in the last four years, more than 1.3 million jobs have been created for a total of 20.89 million members in the seventh month of 2023.

The increase in employment has raised the ratio of contributors per pensioner to 2.4, its highest level of the decade. In other words, currently in Spain there are 2.4 workers for each pensioner. This is a determining indicator to guarantee the sustainability of the pension system, which is largely fed by the contributions derived from wages. The data released this Wednesday suggests that income from social security contributions has grown by 10% in the first half of 2023 compared to the same period in 2022.. If the resources corresponding to the Intergenerational Equity Mechanism (MEI), which began to be applied in January, are discounted, the increase has been 8.2%.

Slowdown in job creation

The number of affiliates to Social Security has been on the rise for six consecutive months, but the growth rate is slowing down. After the reactivation of the hotel industry in April —coinciding with Easter and the arrival of good weather, which resulted in the creation of 238,436 jobs—, May added 200,410 new affiliates. The increases in June and July, of 54,540 and 21,945 contributors respectively, have been far from the marks of the previous months.

In fact, the increase known this Wednesday is the second least pronounced for a seventh month of the year since 2012, only behind the 15,513 jobs created in 2019 and the decline in 2022.. “July ends up destroying hiring and with the lowest month-on-month evolutions in affiliation and unemployment in recent years”, confirmed the director of The Adecco Group Institute, Javier Blasco, who also points out that “the lower GDP growth at the end of the first semester anticipates a month of August in negative figures in comparison with July”.

Less women and foreigners contributing

The increase in affiliation in July has not affected the entire population equally. In fact, the number of female workers has decreased by 41,945 women compared to the June record, thus reducing the total to 9,826,712 affiliates. This job destruction has been offset by the increase in male affiliation, which has grown in the last month by 63,889 men to 11,107,117 contributors.

As among women, the number of workers has also fallen among the foreign population. Compared to the record of 2,698,604 foreign contributors in June, Social Security has lost 3,364 affiliates in July, placing the total number of foreign workers at an average of 2,695,240 employed.

Seasonality in education

The employment data for July show the seasonality suffered by some sectors. With the end of the school year, 110,705 jobs in education have been destroyed, a fall offset by progress in other sectors, especially health and commerce, which have respectively added 49,346 and 41,099 new workers compared to June.

In a month of high tourism season such as July, the hotel industry has created 23,864 jobs, less than health activities and commerce, due to the fact that the bulk of the hiring had already been carried out previously.. In April, for example, this sector added 119,618 members compared to the previous month, with one out of two new contributors concentrated.

Drop in unemployment, especially youth

Parallel to the growth in the number of workers, unemployment accumulates five months down. In the last month the number of unemployed registered in SEPE offices has decreased by 10,968 people. In the last year, unemployment has been reduced by 205,938 people, which represents a decrease of 7.14%. “This percentage decrease reflects a very intense drop given the stable conditions in which our labor market moves, in which the effects of the labor reform are consolidated,” sources from the Ministry of Labor highlight.

The drop in unemployment has been especially significant among those under 25 years of age. In July the number of unemployed young people has been reduced by 453 people, so that youth unemployment has set a new minimum in the historical series with a total of 184,038 young people looking for work.

At the head of unemployment in the eurozone

The decline in unemployment in recent months has brought the unemployment rate down to 11.7%, its lowest level since August 2008, according to Eurostat data.. However, the Spanish figure is higher than that of its neighboring countries. In fact, the unemployment rate in Spain is the highest in the euro area, where the average is 6.4%. “When the Popular Party governed, the differential we had with Europe was 14 points, today we are 5 points ahead of Europe,” Labor Minister Yolanda Díaz defended this Wednesday.

As far as youth unemployment is concerned, Spain is also in the lead, with a rate of 27.4%, compared to the average of 13.8% for the set of partners of the single currency. In fact, one in five unemployed young people under 25 in the euro area is Spanish.

Doubts about the indefinite

Despite the increase in affiliation, recruitment has fallen by 13.54% in July compared to the same month of 2022. The decrease has been especially marked among permanent contracts, whose signing has decreased by 17.43%. “Although indefinite hiring has a greater weight in hiring as a whole than a few years ago, it is not an indefinite hiring as we would like it to improve employment: there has been less hiring this month, but the most has reduced is the indefinite full-time one”, confirms the general secretary of USO, Joaquín Pérez.

After the labor reform, which came into force last year, the temporary rate has been reduced from 30% to 14%. However, the rise of permanent employees has sparked controversy on account of discontinuous permanent ones. As they have a valid contract, the workers hired under this typology do not appear as unemployed during their period of inactivity, but as job seekers. “There is a divergence of 400,000 people between the annual variation of registered unemployment and that of job seekers with an employment relationship, where discontinuous permanent workers in a situation of inactivity are counted,” they explain from Randstad Research. “Only an indefinite full-time job can be considered, unless the worker expressly wishes, a stable, decent job that provides a living. And we don't have that,” they say from USO.