Published on Tuesday, May 16, 2023

Spain | A recovery with more employment than hours worked

One of the most relevant characteristics of the recovery of advanced economies and Spain since the COVID-19 crisis has been the intensity of job creation and the resilience of the labor market. The balance is clearly favorable.

Key points

  • Key points:
  • In the eurozone, the unemployment rate reached record lows of 6.5% in March 2023, down from 7.3% in the fourth quarter of 2019. In Spain, it fell from 14.0% to 12.6% over the same period.
  • Meanwhile, employment in the labor force surveys increased in cumulative terms by 1.9% in the eurozone, a growth similar to that of Spain (2%). According to the National Accounts, the number of people employed grew by 2.3% in the eurozone and by 1% in Spain.
  • Eight EU countries have seen a somewhat smaller recovery in hours worked than Spain, which over the last three years has had a balance sheet very similar to that of Germany. As a result, there are more people working, although with a lower intensity in terms of hours worked per employed person.
  • Among the reasons for this recovery in Spain, which is more intense in terms of employment than in hours worked, there are several causes, such as the fact that the pandemic itself caused an increase in the number of workers on furlough and sick leave from the beginning, which has been reproduced with less intensity throughout its successive waves and with a certain persistence in the symptoms of the disease.
  • Apart from the above reasons, we must add the disruptions in global production chains, the growth of employment in the public sector, the compounding effects of changes in the productive sectors, in occupations and in the structure of the employed population, according to age and gender, the secular trend of a decrease in the number of hours worked annually per employed person, and the increase in the tax wedge on employment.

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