Labour
Business 29/07/2021

Unemployment falls by 21,200 people in Catalonia

Catalan unemployment rate drops to 12.28% despite the impact of the fourth wave of the pandemic

3 min
An occupation office in Barcelona.
Unemployment EPA

Second consecutive time that the Labour Force Survey (EPA) comes with positive data for the labour market despite the pandemic. The statistics the National Institute of Statistics (INE) has made public this Thursday show that during the second quarter the number of unemployed fell by 21,200 people in Catalonia, to 478,500, and the unemployment rate eased to 12.28%. In fact, it was the second region in Spain with the most important quarterly drop, only behind Murcia (-22,200 unemployed). The comparison with the same period of 2020, however, reveals that pre-pandemic levels have not been fully recovered. Catalonia still has 5,600 unemployed more than in the second quarter of last year, when we were in complete lockdown in order to contain the spread of covid-19. It should also be borne in mind that many people who were then still on furlough have now been laid off.

During the second quarter in the State as a whole, unemployment lists were cut by 110,100 people (the strongest quarterly drop since the same quarter of 2019), while the unemployment rate fell to 15.26%. In total, there are currently 3.54 million unemployed in Spain, which is still 175,900 more than in mid-2020. If we compare it with 2019, the gap is even more pronounced: there are 313,200 more people listed as unemployed. Even so, the Spanish government has been able to boast of another positive figure: 68,400 households no longer have all of their members unemployed (overall there are still 1.1 million).

One million more employed in a year

The positive trend in the data published by the Ministry of Labour has also been noted in the pace of job creation. From April to June 464,900 new jobs were created and 1.06 million jobs were recovered compared to a year ago, up to 19.6 million. Catalonia also ranked second in terms of job creation over the last year. Specifically, 189,600 new jobs were created, only beaten by Andalusia's 245,700. In this last quarter, employment has increased by 43,300 people in the Catalonia.

The survey's data hide another reason for optimism, as Josep Lladós, member of the Association of Economists of Catalonia and professor of the UOC, emphasises. "The creation of employment has been accompanied above all by an increase in activity. These are not people who had recently lost their jobs, but rather people who had become discouraged or had no opportunities to find work and have now gone back to looking for work and have joined the labour market," the economist points out. In this second quarter, 354,800 people joined the labour force in Spain, while in Catalonia it was 22,100.

The recovery of employment (personas ocupades) and labour force (persones actives)

Lladós, however, recalls that this reality has another side to it. A year ago in the State there were 397,500 people who had been unemployed for over a year. This figure now stands at 797,800. "We are in a process of technological change that has now accelerated and we have look out and carry out active employment policies so all these people do not drop out of the labour force. There is a risk of creating a persistent pool of unemployment over time because the training requirements are increasingly important and they must be invested in", he explains.

The impact of the fifth wave

What impact is now expected from the fifth wave of the pandemic? Lladós is confident that this new wave of infections "will slow but not reverse" the recovery of the labour market. In any case, he warns that this improvement will continue to be asymmetrical and much slower for sectors that are still affected by the restrictions, such as the hotel, catering, culture or leisure sectors. "There is still work to be done and we must remember that we are still creating temporary jobs. We have to rediscover the pre-crisis situation, but do it with less precarious work," he adds.

The president of the Spanish government, Pedro Sánchez, has assured that this Wednesday's data imply that the State has overcome "the stage of resistance to the pandemic" and already begins its economic recovery. Thus, he stressed that this will be "the period of biggest reform and investment in recent decades", which will be accompanied by the arrival of European funds, Núria Rius reports. At the same time UGT union has warned that this improvement "can deflate if changes are not implemented in the labour market," referring to its negotiations with the Ministry of Labour and employers to repeal some of the most harmful aspects of the previous government's labour reform.

These indicators are a preview of the data that the INE will publish tomorrow on Spanish GDP, which will also reflect an acceleration for the economy as the vaccination campaign progresses. EPA for the first quarter of 2021 already brought a lull for employment data, with a drop in the unemployment rate in Catalonia to 12.9%. Then, the labour market managed to break the psychological barrier of half a million unemployed and, although the figures were still worse than the previous year, the recovery's green shoots were beginning to sprout.

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