The Coronavirus Destroys 1M Jobs In Spain In Q2’20, Leaving The Unemployment Rate At 15.33%

The labour market reform in Spain: a user’s guideThe Labour Force Survey does not include those affected by a temporary-lay-offs with suspension of employment

The results of the Labour Force Survey (EPA in its Spanish acronym) for the second quarter of 2020 continue to reflect the situation arising from the pandemic. Employment fell by 1,074,000 persons in this period. It should be borne in mind that this figure does not include those affected by a Temporary Employment Regulation Scheme (the so-called ERTE) with suspension of employment. According to the methodology of the Statistical Office of the European Union (Eurostat) and the International Labour Organisation (ILO) applied in the Survey, those people are considered as employed.

However, the suspension or reduction in the working day of those workers affected by an ERTE, together with other kinds of absences from work (such as partial unemployment for technical or economic reasons, or illness, accident or temporary disability), was reflected in the effective hours of work carried out. This figure decreased 22.59% compared with the first quarter. So the number of employed who actually worked in the second quarter fell to 13,901,000 (35.14% of the population aged 16 and over).

Some 16.20% of employed people (3,015,200) worked from home more than half of the days, as compared with 4.81% registered in 2019.

Meanwhile, the unemployment figure rose by by 55,000 people, with the unemployment rate standing at 15.33%. It should be borne in mind that not all those who have lost their jobs are now classified as unemployed, according to the ILO definition. A considerable part has become inactive, a category which has seen a rise of 1,062,800 persons.

This increase in inactivity is mainly due to the fact that confinement and closure of companies have prevented 1,628,500 people from seeking employment, despite being available for work. As a result, they have not been able to meet all the conditions required by the ILO definition to be classified as unemployed. So they have been classified as inactive.

A more detailed view of the transitions between employment, unemployment and inactivity is obtained with the Flow Statistics. These show that 1,034,200 employed persons and 1,107,600 unemployed persons in the first quarter have become inactive in the second quarter. Similarly, 454,800 unemployed persons and 409,600 inactive persons in the first quarter found employment in the second quarter.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.