Cautious welcome for slight dip in unemployment

The Spanish National Statistical Institute has presented the results of the Labour Force Survey for the third quarter of 2009. The survey shows a slight reduction in unemployment, combined with a decrease in employment and a substantial loss of stable jobs. Reactions of the government and social partners have been cautious, citing different reasons for the first reduction in two years in the number of unemployed persons.

Details of labour force results

At the end of October 2009, the Spanish National Statistical Institute (Instituto Nacional de Estadística, INE) presented the results of the Spanish Labour Force Survey (Encuesta de Población Activa, EPA) corresponding to the third quarter of 2009. The results are somewhat significant as, for the first time in two years, they show a decrease in the number of unemployed people. Unemployment has declined by 14,100 persons in comparison to the previous quarter, with the number of unemployed people now standing at 4,123,300 persons.

However, in parallel, the EPA results also show a decrease in employment, by 78,000 persons compared with the previous quarter. Furthermore, the EPA notes the loss of some 161,200 stable jobs – that is, jobs with open-ended employment contracts – together with an increase of 74,500 in the number of jobs with fixed-term employment contracts.

Government viewpoint

The government’s reaction has been marked by caution and moderate optimism regarding the effects of the so-called Spanish Plan for Stimulating the Economy and Employment (Plan Español para el Estimulo de la Economia y el Empleo, Plan E). This strategic plan includes a series of measures aiming to promote employment, such as local investment funds for the promotion of infrastructure and work in municipalities (ES0902049I). The government considers that the implementation of the Plan E is having a positive influence on employment. However, the Minister of Economy and Finance, Elena Salgado, has emphasised that, despite the slight reduction in the number of unemployed people, high unemployment figures will continue to be a reality for a few quarter periods before the economic recovery is fully consolidated.

Reaction of social partners

For their part, the main trade union confederations – the General Workers’ Confederation (Unión General de Trabajadores, UGT) and the Trade Union Confederation of Workers’ Commissions (Confederación Sindical de Comisiones Obreras, CCOO) – concede that the Plan E is having a positive effect, mainly with regard to the local investment funds. In addition, they highlight that the reduction in unemployment is also due to seasonality: in Spain, the third quarter of the year always presents positive results in terms of the labour market due to the favourable effect that tourism has on employment during the summer months.

However, the trade unions continue to consider the country’s economic situation as being very serious. As stated by the CCOO Secretary General, Ignacio Fernandez Toxo, ‘the Spanish economy has lost more than one million temporary jobs in one year, although what is now noticeable is the loss of stable employment’.

Meanwhile, the most representative employer organisation, the Spanish Confederation of Employers’ Organisations (Confederación Española de Organizaciones Empresariales, CEOE), continues to maintain a critical line, warning that the momentary respite of the summer months should not entail a delay in the structural reform needed in the labour market. The employer organisation is seeking a reduction of the dismissal cost associated with permanent employment contracts; in CEOE’s opinion, this strategy would put an end to the duality that exists between workers holding temporary and permanent employment contracts.

Pablo Sanz de Miguel, CIREM Foundation

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