The data on the evolution of the Work market during the past quarter show a tremendously worrying figure: the only increase in the job between October and December 2022 came from the public sectorwith 20,000 more people, while the private sector destroyed nearly 102,000 jobs. Of all the employment created in the year, 228,200 people have been employed in the private sector and 50,700 in the public, almost 19% of the total. The dismal trend reflected in employment in private companies and institutions in the second half of the year is related to the intense growth slowdown that has occurred throughout the year, which began with increases in GDP close to 7% and will have finished -when the official figures are known definitively- around 2%.
It is also worth taking into account the effect of inflationwhich was very high during the first part of 2022, until it exceeded the level of 10% in July -it ended the year at 5.7%-, and which has had a clear influence on the demand for goods and servicesundermining hiring and dissipating the strength of the labor market, at the same time that it has triggered the business closures and the bankruptcies as well as caused a fall of more than one hundred thousand autonomousa fact that was considered yesterday as “a real catastrophe” by the president of the ATA association -is the worst in the historical series-. The overall uncertainty created by the Russian invasion of Ukraine and the war that has been going on since February 2022 has also had a strong impact on the confidence indicesboth businessmen and consumerssubtracting dynamism from the activity and harming above all the weakest part of the productive fabric.
Although the labor market ended 2022 with 278,900 busy more, 79,900 stopped less and a drop in the temporary rate of more than 7 points to 17.9%, according to data from the Active Population Survey (EPA) released yesterday by the Statistics National Institute, there are not many reasons for optimism, according to the experts consulted by OKDIARIO. The reduction in temporary employment has almost everything to do with the explosion of discontinuous permanent workers, due to the prohibition imposed by the labor counter-reform promoted by the Vice President and Minister of Labor, Yolanda Diaz.
Also, economists like Jose Luis Done -member of the JCEOE Board of Directors-, Lorenzo Bernaldo de Quiros -president of the feemarket consultant, Ricardo Martinez Izquierdo -President of Economic Team– o Manuel Balmaseda –chief economist at Cemex-, having finished 2022 with an increase in employment of only 1.3% when GDP may have grown by 5% or even more, is a very poor balance. «Under normal conditions, the rate of job creation is always higher than that of economic activity -although this has the negative effect of reducing productivity-, and we have verified that this has not even occurred in a relatively good year in terms of nor is it going to happen during the present exercise». In his unanimous opinion, the decoupling between strong GDP growth and meager employment growth has only one explanation: the persistence of the rigidity of the labor market, which has intensified even more with the counter-reform of the Government.
In addition, these unfavorable results have taken place despite the fact that a lot of money has been injected into the productive system -as faithfully reflected by the increase in state deficit and the increase in public debt– with all kind of supports and grants diverse to alleviate the effects of the crisis among consumers, plus the first projects launched on the occasion of the funds europeans -although its execution is being very slow and debatable, with the European Parliament in full scrutiny on how the President Sanchez is using the money granted by Brussels.
The evolution of the last quarter of the year, however, leaves 81,900 less employed, the largest decrease for this quarter since 2013, when they fell by 94,800 people. As for the unemployment rate, it has stood at 12.9%, the highest level in the European Unionup to double the percentage of the the euro zone. The number of unemployed exceeded three million in the whole of 2022, and in the last quarter it registered the highest increase at the end of the year since 2012.
