A PwC report lowers growth for this year from 5.9% to 5.5% of GDP


Madrid

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The participants in the «Economic Consensus», the quarterly economic report prepared by PriceWaterhouse Cooper’s consultancy since 1999, have lowered the scope of the recovery this year from 5.9% to 5.5% of GDP. Projections that are below those maintained by the Government (7.2%) and are in line with the estimates of the European Commission (5.6%) and the IMF (5.9%). Looking ahead to next year, a growth of 4.8% is estimated. This reduction is attributed in the report to “restrictions on mobility throughout the country as a result of the successive waves of the pandemic and the rate of vaccination.”

Experts, entrepreneurs and representatives of business organizations have agreed to consider as bad or very bad the situation of the Spanish economy, with up to 83.4%, although 71.4% expect to see light after the tunnel from the second quarter of the year, and 87.5% believe that this improvement will come in the next twelve months. In addition to the aforementioned reduction in growth forecasts, there is a notable concern about the financial situation of families. For example, 51.8% of the experts and 58.8% of the companies participating in this edition of the “Economic Consensus” call it bad.

Instead, they are already 60.5% – 14 points more – who hope that family consumption will reactivate in the next six months and 55.3% of the experts consulted believe that the demand for housing will remain stable. On the business side, the number of participants who estimate that there will be an increase in exports – 62.2% – and up to 51.4% believe that the productive investment of the companies will be maintained for the next six months.

According to the employment creation, opinions are much more divided: 35% of the companies surveyed assure that it will increase, 30.6% that the level of employment will be maintained and a prominent 34.2% think that this variable will worsen.

Youth and unemployment

The last year has once again buried the expectations of a large part of the younger population. The unemployment rate in this segment of the population has picked up again, reaching 38% in 2020 and returning to an undesirable leadership within the European bloc. The experts, managers and businessmen have agreed that the reduction of the young population, a training that is not adapted to the productive needs and the excessive temporality they are the axes on which to act.

Specifically, 93% of the experts and managers surveyed view with great concern the reduction of the population between 16 and 34 years of age, in addition to their low participation in the labor market compared to other European countries. To do this, among other measures, they have proposed to introduce changes in training, so that it is more linked to productive needs and reduce temporary employment – a measure supported by 67% of those surveyed – acting so that there are fewer temporary contracts between this group (they exceeded 48% of contracts in 2020). For this, the majority bet on reduce the difference in layoff costs between temporary and fixed contracts. Up to 41% also bet on penalizing the accumulation of temporary contracts.

Panelists have also agreed that hThere is an imbalance between non-compulsory secondary studies (Baccalaureate, intermediate grade FP) and the weight of Primary and secondary studies, especially university studies, with the consequence that many graduates end up in lower-skilled jobs. In this sense, 96.3% bet on encouraging vocational training by 56.5% who prefer to reform university training.

Experts and businessmen also believe that the supply of youth work with technological training and they propose two measures: to reinforce secondary and higher education with a greater technical-mathematical offer (73.2%) and to increase female participation in this type of studies (46.3%).

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