ECONOMY

Sluggish January sees 244,000 jobs destroyed in Spain

Registered unemployment rose by 90,248, making this the worst month of January since 2014

The first month of the year is never good for the Spanish job market. Even when the economy is growing robustly, Social Security affiliations drop and unemployment spikes.

It was no different in 2020, when the number of contributors to the Social Security system – a measure of job creation – fell by 244,044 people, the biggest drop for a month of January since 2013.

However, the overall number of contributors to Social Security remained above 19 million, according to figures released on Tuesday by the Social Security Ministry.

After Christmas, many seasonal hirings in retail and hospitality come to an end

Registered unemployment rose by 90,248 from December, making this the worst month of January since 2014. There are now 3.25 million people signed up as unemployed, according to the Labor Ministry.

A bad month

After Christmas, many seasonal hirings in retail and hospitality come to an end. So do many other contracts signed for one natural year. Together with the economic slowdown (motor vehicle registration, which is a good indicator, fell nearly 8% in January), these factors have made this the worst month of January in some time.

The figures are better compared with January 2019, since job creation grew by 1.83%, but even then, it is the first time since the summer of 2014 that job growth is under 2%.

The figures were released on the same day that the Spanish Cabinet held its weekly meeting. One of the issues on the agenda was approval of the minimum salary hike, which is being set at €950 a month after negotiating the terms with employers and unions. Ministers are also expected to greenlight a 2% hike to civil servant salaries and a 0.9% raise to pensions.

English version by Susana Urra.