Spain smashes employment record with 783,000 more jobs in 2023 and drops unemployment rate to 11.7% | economy

The National Institute of Statistics (INE) this Friday certified the enormous strength of the Spanish labor market. The Spanish economy will gain 783,000 new jobs in 2023, according to data from the Active Population Census (EPA) corresponding to the last quarter of the year. This gain represents a new record of 21,246,900 employed persons in Spain and confirms the vigor of the labor market. Only in 2005 – when an extraordinary regularization of 700,000 immigrants was carried out (one million jobs were created in the year) – and in 2021 – due to the recovery after the Covid crisis, (840,600) – exceeded the amount of last year , but the paradoxical nature of those situations makes the 2023 data a record for employment in one year for Spain. becomes At the same time, the number of unemployed was reduced to 193,400 last year, bringing Spain's official unemployment rate to 11.7% of the active population in 2023.

This unemployment rate was not further reduced despite strong job creation due to other good news recorded in the behavior of the labor market last year: an increase of 600,000 people in the active population. This indicator, which exceeded 24.12 million people for the first time in the previous quarter, is also a reflection of the dynamism of the market, as one of the reasons for the increase in assets is the general good performance of the economy and employment enabling workers. Those who are unemployed or looking for work. Although there are other less positive reasons, such as the loss of purchasing power, it is constantly recorded – although to a lesser extent than in previous years – that a part of this inactive population wants a job and is looking for one, whether they find one or not.

One of the first things to notice in the behavior of the labor market last year was the strong traction given by the employment occupied by foreigners, since 449,300 of the total new employees were Spanish and the remaining 355,500 came from outside Spain. This means that almost half of the new employment (45.5% is occupied by foreigners). In this way, annual employment among foreigners has risen by almost 11% compared to an increase of 2.5% among Spaniards.

In terms of distribution by gender, more employment has been created among women (355,500) than men (355,500), which is on the verge of surpassing ten million workers for the first time in history (9. 92 million). Employment has been created for all age groups, except for the 40 to 44 age group, where the net balance shows a job loss of 43,000 males and 27,000 females. The largest share of new employment was taken by people over 50, with 425,000 new jobs (more than 272,000 of them were over 55). But younger workers also posted good results, as 200,000 new workers under the age of 29 were counted.

All services and very small business

The distribution of these new jobs by sector comes as no surprise. Last year's good results in tourism and all related activities, and the remaining jobs in the service sector, created eight out of ten new jobs. However, construction experienced a strong boost, with employment growth of 8% over the year (108,200 new workers). Meanwhile, the not-so-good news is that industry, the most value-added sector in the economy, had a dismal performance in 2023, growing by just 1% for the year, well below the general average. 3.8%), with 28,000 new hires.

The abundant and complete data provided by the EPA allows us to see the quality of employment created, which also registers very positive signs in this regard. Thus, for the first time in the history of the Spanish market, there are more than 18 million employees, after growing by 664,000 people during the year. But, at the same time, another 118,300 self-employed workers were counted, of whom 21,300 were employers (who had employees) and 112,000 were self-employed without employees. The latter grew by a robust 5.6% in 2023, after years of limping due to the strong impact they experienced on pandemics.

These first figures known from the EPA – the official statistics measuring Spanish employment in Europe – confirm the resilience of the Spanish labor market last year, which was already expected recently by other indicators such as data. Public employment offices counted half a million new workers joining the system and 130,000 fewer registered unemployed from Social Security registries. However, last quarter, as usual, the market lost 19,000 workers, although unemployment fell by 24,600 to 2,830,600.

This good performance of the labor market is not surprising. In fact, Carlos Badi, the recently appointed Minister of Economy, Trade and Commerce, promised in one of his first interventions that Spain “is growing thanks to a fundamentally very strong labor market and a solid external sector”. The good performance of permanent employment attracts attention for the second year in a row after the approval of the labor reform that took effect in early 2023.

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