Coronavirus crisis brings worst March on record for Spain’s labor market

Jobless claims surged by 302,000 people and social security affiliations slumped by over 800,000

A closed H&M store on Madrid's Gran Vía.
A closed H&M store on Madrid's Gran Vía.Pablo Monge

As Spain grapples with a coronavirus pandemic that has already claimed over 9,000 lives, new unemployment figures released on Thursday confirmed its devastating effects on the labor market.

Jobless claims surged by 302,000 people in March, the highest increase on record, according to the Labor and Social Security ministries. This figure easily overtakes the previous record of January 2009, when the number of people claiming unemployment benefits grew by 200,000 as Spain entered a protracted economic crisis. This puts the total number of unemployed at 3.5 million people in a country with a persistently high jobless rate that is currently 13.78%, according to the National Statistics Institute (INE).

Social security system affiliations – considered a measure of job creation – fell by 833,979 in March. The ministry noted that while normally it provides an average figure for the month – which in this case is 243,469 – job destruction really began to surge around March 13 due to the coronavirus crisis. For this reason, the ministry decided instead to underscore the affiliation figure from March 31, which shows a reduction of 833,979 from the beginning of the month.

March is normally a good month for jobs as the country gears up for the Easter holidays, one of the peak moments for the country’s powerful tourism industry

“We are in an absolutely exceptional situation,” said Labor Minister Yolanda Díaz at a news conference on Thursday morning. “The month of March was evolving normally until the 13th. Starting on March 13 we began observing a daily increase in the unemployment numbers.”

The minister also noted the effects of job destruction on women. “The virus does not have a specific gender impact, but structurally the labor market has a very strong gender bias. There are two million women out of a job,” she said.

In a release, her ministry added that “the impact of the coronavirus pandemic can be notoriously appreciated starting on March 12, so that the average affiliation figure does not rigorously reflect what happened during the whole of the month.” In the first 11 days of the month, jobs were still being created.

March is normally a good month for jobs as the country gears up for the Easter holidays, one of the peak moments for the country’s powerful tourism industry. Hirings typically begin now and continue throughout the spring and into late summer, when the tourist season begins to wane.

But the coronavirus crisis has effectively ended the industry’s Easter prospects, if not the entire summer season. The government decreed a state of alarm on March 13 and introduced strict confinement measures to curb the spread of the virus. Last weekend these measures were toughened up, with all non-essential workers told to stay home until the state of alarm is lifted, presumably on April 12 if no further extensions are announced.

English version by Susana Urra.

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