Crisis bites hard in Spain’s labour market as 219,000 lost their jobs in January

New and tougher restrictions, among other nightly curfews, in Spanish provinces and regions, have directly contributed to this hard bite on the job market, said Pepe Álvarez. [EFE/Fernando Alvarado]

The impact of the COVID-19 crisis in Spain’s labour market is devastating as over 218,000 people lost their job in January, according to new figures. The services, tourism, and the hotel, restaurant, and catering (HORECA) sectors are among the most affected, EURACTIV’s partner EFE reports.

According to fresh data released on Tuesday by Spain’s ministry of inclusion, social security and migration, the labour market lost 218,953 workers last January (compared with 335,014 in the same period last year), bringing down the number of registered people employed to 18.8 million.

While the unemployment rate stood at 16.13% (3,964,353 people), 738,969 are still affected by a temporary lay-off scheme (Expedientes de Regulación Temporal de Empleo, or ERTE in Spanish). This means that the number of workers under an ERTE scheme has increased by 35,625 compared to December. Worth noting, people included in the ERTE scheme are considered employed, meaning they are not counted as “unemployed”.

Under the ERTE scheme, the Spanish state gives workers about 70% of their salary and prohibits companies from firing people. In case of fraud or redundancies, companies must return exemptions from contributions to the social security system and risk heavy penalties, according to Spain’s labour ministry.

'Annus horriblis' for Spain's labour market

The economic side-effects of the COVID19 pandemic in Spain have been devastating for the country’s vulnerable labour market as almost 623,000 people lost their job last year, according to fresh data released Tuesday by Spain’s National Statistics Institute (INE).

According to …

The figure is “doubtless bad”, said Pepe Alvarez, the secretary general of one of Spain’s main trade union, the Unión General de Trabajadores (UGT). This is partly due to a very negative winter sales season when big shops and department stores usually hire extra workers, Alvarez told Spain’s state radio and television station RTVE on Tuesday.

The trade union leader has asked the government to put in place urgent financial measures to ease the situation of the most affected.

New and tougher restrictions, among other nightly curfews, in Spanish provinces and regions, have directly contributed to this hard bite on the job market, Álvarez added.

Lorenzo Amor, president of the Spanish Association of the Self-Employed Workers (Asociación de Trabajadores Autónomos, ATA) urged the government to implement extra measures and stop the “bleeding “ in the labour market. It is time to act urgently and “save jobs”, he said.

Spain’s job market suffers, among other issues, from a high percentage of temporary and precarious work – a chronic problem now aggravated by the COVID-19 pandemic. The youth unemployment rate is particularly high, at 40.7%, which ranks the Iberian country as the worst in the EU list, followed by Greece (35.5 %), according to data from Eurostat.

[Edited by Daniel Eck and Frédéric Simon]

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