Employment in Spain grows for the first time during Covid-19 pandemic

Spain’s temporary layoff scheme, known as ERTE, is shoring up the labor market during the coronavirus crisis, new figures show. At the very least it is preventing the kind of debacle experienced during the last two weeks of March, when around 900,000 people lost their jobs in the wake of the lockdown introduced by the government on March 14.

New data shows that employment actually grew in May, as measured by new Social Security registrations, considered a measure of job creation. Registrations rose by an average of 97,462 new contributors for a total of 18.5 million.

But between March 12 and May 31, the Social Security system lost 760,082 contributors, using daily figures. The uptick in May means that the labor market has regained nearly two out of every 10 jobs.

Although 450,000 furloughed workers have gone back to their jobs, there are still nearly three million people on ERTEs across Spain

Meanwhile, the number of registered unemployed rose by 26,573 people, for a total of nearly 3.75 million, according to figures released on Tuesday by the Labor and Social Security ministries.

All of these numbers are heavily influenced by the ERTE furloughing scheme, which allows companies to temporarily send workers home or reduce their working hours, but forces them to take them back after a certain amount of time. Thousands of businesses have applied for ERTEs, driving up claims at state employment agencies.

Although 450,000 furloughed workers have gone back to their jobs, there are still nearly three million people on ERTEs across Spain.

The crisis has been especially hard on the tourism industry, which contributes more than 12% of Spain’s gross domestic product (GDP). The sector is hoping for some relief as the country moves out of a prolonged lockdown, with international travel expected to resume by early July at the latest.

English version by Susana Urra.