Spain | The evolution of employment and returns to capital between crises

Summary

Employment in Spain fell by 4.4% between 2008 and 2019. The sectors that contributed most to the fall were those affected by technological change or which started the crisis oversized. In all of them, except finance, the share of capital income in GVA increased, while employment fell.

Key points

• Key points:
• Whether because of the need to reduce the scale at which some sectors were operating or because of the observed impact of technology on labour intensity, there have been parts of the economy which, despite the economic recovery, have reduced their share of employment.
• This decline in the number of people employed occurred with a moderate increase in the share of capital income in Gross Value Added (GVA).
• This points to a negative relationship between the share of Gross Operating Surplus (GOS) and job destruction by sector.
• The exception is the financial sector, where the share of GOS in total GVA has fallen, and where there has not been as significant an adjustment in employment until 2019 as in construction, industry or agriculture.
• On the other side of the coin are sectors such as hotels and catering, education, information and communications or water supply, where there was a significant increase in employment, while at the same time the share of GVA in GVA fell significantly.

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