The good news is that employment continues to grow. 54,541 jobs were created in June, bringing total affiliates to 20,869,940, the highest level in the series and with an eye on the symbolic target of 21 million affiliates. In addition, unemployment is reduced by 50,268 people and its total number drops from 2.7 million for the first time in 15 years.
In other words, this year’s positive streak continues in terms of employment. However, the nuance comes when a slowdown in the creation of jobs is observed. It is noticeable when checking that the increase of 54,000 new affiliates is far below the growth in membership in the months of June in recent years; for example, it is half of what was achieved last year and is the lowest growth in a month of June since 2015.
And even more significant, if you look at the seasonally adjusted data, i.e. corrected for season and calendar effects, and those that have always been preferred by the Ministry of Inclusion and Social Security, jobs were lost in June. Specifically, there are 20,119 fewer affiliates.
It is true that from January to June, in seasonally adjusted terms, there are nearly 450,000 more members, which is the best first half of a year in the entire historical series. But this rate of job creation is difficult to maintain, and in June there are signs that it is already faltering.
It’s a slowdown that the Social Security recognizes, although they qualify. The Secretary of State Borja Suárez has stated that some circumstances have caused the result to be “a little less high than could have been expected” and adds that, although the second semester usually always gives more modest results, the objective of the 21 million affiliates is within reach. “The dynamic is positive and sooner or later we will reach this threshold”, he said after presenting the data.
Among these slowing factors are the weather, which has affected agriculture and construction, and the establishment of new councils, with a sharp drop in public employment on the day of their establishment, in mid-June.
From Funcas they consider that this slowdown could be caused, in part, by an anticipation of the usual hirings from this month to previous months, which would fit in with the very good results of the spring; and in part, due to a moderation in the growth of the economy. “In any case, it is still too early to talk about a change in the trend in the evolution of employment and it will be necessary to observe the evolution over the coming months”, say Funcas.
Analyzing the sectors, in hospitality and trade the increase is a little more than 30,000 new jobs in each sector, when higher figures could be expected in June. From the Social Security, they point out that in the hospitality industry there was an anticipation of hiring in April and May, which were two particularly good months, which explains the June figure. What takes its toll is the end of the school year, with a sharp drop in education, in which 50,000 members are lost, a reduction of almost 5%.
With regard to the quality of employment, the percentage of affiliates with a temporary contract remains at a historic low of 14%, less than half of what was recorded before the entry into force of the labor reform, when it was about 30%. In the case of those under 30, the temporary rate has been reduced by 31 points compared to the level before the reform.
Regarding registered unemployment, the total of 2,688,842 unemployed is the lowest since 2008. There are 50,268 fewer unemployed, but it is a figure that is well below the average for the months of June in recent years . Here, too, there is a slowdown in progress. In any case, the decline in unemployment is widespread throughout the country, affecting all sectors, except for a minimal increase in agriculture, and all age groups. The most significant decline takes place in the services sector, with 42,000 fewer unemployed; followed at a distance by industry and construction.
Regarding hiring, and although June is a month prone to seasonality, 42% of the total contracts signed are of an indefinite nature.
Of these contracts, the majority are fixed discontinuous, 40% of the total; 38% were registered full-time, and part-time, the remaining 22%. “June was a terrible month for indefinite employment”, said the Secretary of State for Employment, Joaquín Pérez Rey, and underlined the changes brought about by the labor reform, which yesterday he insisted on calling repeatedly the Díaz reform.
On the part of the CEOE, in view of these data, “the worrying slowdown in job creation” has been highlighted, based on an increase in membership and a reduction in unemployment that are far from the average of the months of June in the pre-pandemic period. Specifically, the employer calculates the period 2014-2019. In addition, the CEOE recalls that forecasts point to a significant slowdown in the economy in the second part of the year.
