"The labor reform is changing the paradigm and the May unemployment data will surprise"

“The labor reform is working”, the Second Vice President and Minister of Labor, Yolanda Díaz, reiterated this Thursday in her speech at the second edition of the Conference on European Recovery Funds organized by elDiario.es. Díaz has warned that “the data is clear”, with a great boom in permanent work and a decrease in temporary work after the entry into force of the new legislation. “The labor reform is changing the paradigm, temporality was not a divine curse”, the minister stressed.

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Díaz valued the “different” response that the Government has put in place to deal with the crisis due to the pandemic, compared to “austerity” as a reaction to the past financial crisis. The Minister of Labor has celebrated that this change is in line with a more “solidarity” response from the EU to this emergency, as shown by the Recovery and Resilience Plan.

On temporary work, the person in charge of Labor has maintained that in the new reform of the labor market other "recipes" have been launched, compared to "the usual ones" that had not contained this problem in recent decades.

Yolanda Díaz has announced that "in the coming weeks" the PERTE of Social Economy of her Ministry will be presented, which will be "very focused on care".

The recovery funds, officially called "Next Generation EU", are expected to mobilize 750,000 million euros in the coming years. The funds have been distributed among the different member countries of the European Union and Spain is, with Italy, one of the most benefited countries. It corresponds to 140,000 million euros.

The minister has celebrated the role of social agents and dialogue in the COVID crisis, which she has insisted on maintaining in the face of the next pending laws. Like the Scholarship Holder Statute and the future Training Law, about which Díaz has been “optimistic”.

The leader of the CEOE business association, Antonio Garamendi, who has also participated in the sessions organized by elDiario.es, highlighted the need for more financing to be provided to small and medium-sized enterprises (SMEs), with more difficulties to participate in the European funds program, with the contribution of 50% of the project budget.

Unemployment in May “will surprise”

The Minister of Labor has anticipated that the unemployment data for May, which will be known in early June, "will surprise". Currently, the total number of unemployed people is 3,022,503. Díaz has referred to the fact that the "surprise" is not only due to the increase in permanent contracts, which skyrocketed with the labor reform, but also to the reduction in unemployment.

At the moment, unemployment is still very high in Spain, at the head of the EU, but it has not skyrocketed after the pandemic as some estimates predicted, thanks above all to the ERTE system, the vice president recalled. Yolanda Díaz has referred, for example, to a recent Eurofound study that has calculated that without this internal flexibility tool unemployment would have risen to 30% in Spain, triple the EU average.

At the moment, unemployment is falling in a context of implementation of the labor reform and uncertainty due to the war in Ukraine. “I am aware that there is still a lot to improve”, Yolanda Díaz acknowledged, but she celebrated that the labor reform “already serves to change people's lives”.

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