The uncertainty about the evolution of the economy in the coming months has taken its toll on the morale of businessmen. Although August is usually a tough month for the labor market due to the end of the tourist campaign, the bad feelings about what the activity holds have ended up propping up a bleeding of contracts that reached its peak on August 31 when they reached lose nearly 270,000 jobs in a single day. The result: Spain did fall below 20 million contributors at the end of August, reaching a total of 19,865,756 affiliates.
Thus, many of the contracts that could have been extended beyond this month in anticipation of an extension of the summer season have been cut short by the unflattering forecasts for all sectors. In this sense, if we observe the daily affiliation to Social Security for the month of August, we can see how the rate of job destruction has remained practically constant since the first days: on day 1 56,589 jobs were lost, on day 2 another 34,582 and another 10,626 on the third day of the month.
The flow of the daily balance of contributors, furthermore, is worrying and accounts for a fatigue in the labor market that had been giving the Government more happiness than expected and that discounted the days to correct the strong path of creation since the worst months of the pandemic. In fact, between the last day of July and August 31, 409,429 jobs were lost, more than half of them on the last day of the eighth month of the year.
The daily analysis, in fact, delves into the diagnosis of the paralysis that has been installed in the summer weeks with the greatest tourist influx, both for foreign and national visitors. Thus, while on June 20 the peak of affiliates was reached in Spain between the summer months accounting for 20,450,472 contributors, at the end of August the 19,865,756 affiliates represent 584,706 jobs destroyed in two months and one week.
As Adecco experts point out, the picture that the labor market throws does nothing but cast a shadow over the forecasts for the general economy between now and the end of the year. From the outset, September is seen as a key month to check the ability to recover jobs after losing the incentive of tourism for hiring. “The most common thing is that in September there is a very small increase in enrollment compared to the previous month. Hence, the year-on-year rise could moderate more, up to 3.3%, with 20.17 million employed. Unemployment, which tends to rise slightly in September compared to August, would add up to 2.93 million people (-9.8% year-on-year)", says the director of the Adecco Group Institute, Javier Blasco.
In this sense, it should be remembered that beyond the daily behavior that reflects the high volatility of hiring throughout the same month, the general figure of 190,000 average affiliates lost in August does not leave a good mark either. It represents a loss of more than 6,000 daily jobs. And to which must be added the increase of 40,000 unemployed on the SEPE lists.
Bad figures and bad expectations
Thus, the general result of the employment and unemployment figures published this Friday by the Ministries of Labor and Social Security reflects, above all, a strong erosion in the confidence of employers and the anticipation of decision-making related to employment in key of crisis, which pays runaway inflation for the third consecutive month above 10% and uncertainty about the impact on Western economies of the Russian invasion of Ukraine.
“From a more global perspective, the economic indicators already reflect how the escalation of inflation to double-digit levels is having a significant impact on the pockets of citizens and on the activity of companies,” the CEOE said in a statement after make employment data public. From the organization they recall that in April an interannual rate of job creation of 5.1% was reached, while in August said rate stood at 3.5%.