Spain’s labour market continues to improve

Spain's labour market continues to improve

Spain’s labour market continues to improve

The Spanish Labour Ministry has announced the much anticipated employment figures for the month of November and, as many had predicted, the release of the news shows a firm consolidation of the feeling that Spain is finally tackling its high unemployment.

According to the latest information released, the number of those unemployed in Spain fell again in November, this time by 6.2% year-on-year. This fall is the sharpest rate of decline in unemployment figures for a November in recorded history and marks the first month of decline after unemployment rose in the traditional post-summer lull. The current figure now rests at 23.67% and reflects the lingering impact of the bursting of a construction bubble in 2008, which sparked five years of stop-start recession in the Eurozone’s fourth-largest economy.

AN ECONOMY EMERGING FROM RECESSION

Spain emerged timidly from recession in mid-2013 and in the second quarter of this year posted its strongest quarterly growth since 2007, expanding by 0.6 percent. The economy grew by 1.6 percent over the past 12 months, up from the 1.3 percent year-on-year increase registered in the second quarter. The government predicts the economy will expand by 1.3 percent in 2014 and by 2.0 percent in 2015. This strengthening in the employment market shows that the government’s pledge to tackle the unemployment that has ravaged the country since the European debt crisis began over four years ago is beginning to bear fruit. Through a series of overhauls to the labour market aimed at making it easier for companies to hire and fire workers, the employment market in Spain has undergone some radical changes in recent years under the watchful eye of the conservative government. The Minister of Employment and Social Security, Fátima Báñez, hailed the news as a breakthrough and reaffirmed that although there has been a lot achieved, the Spanish government remained committed to ensuring there are job opportunities for the Spaniards who remain out of work.

LABOUR MARKET BENEFITING FROM INCREASED DEMAND 

There are, however, some who claim that the drop in unemployment is being fuelled by the high number of foreign nationals who are leaving Spain as they struggle in their search for employment. During the early 2000s, while the economy was booming, Spain opened its doors to more than 700,000 immigrants per year. Since the bursting of the property and construction bubble, however, many have been forced to flee. That aside, the Spanish economy is continuing to defy expectations and is now outperforming its European rivals. The economy has now posted 5 consecutive  quarters of positive growth and this is leading to more companies hiring as the internal demand is now beginning to match the external demand which has remained strong throughout the downturn. The Spanish government remains optimistic and has increased its economic outlook for 2015 and the expectations are that the unemployment figures will continue to be slashed as the labour market in Spain continues to become more competitive and open to investment.

For more information on investment in Spain, contact corporate law firm Argali Abogados.

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