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According to Eurostat, Spain showed the third highest reduction in the unemployment rate in the EU in 2005. The largest trade unions, however, consider that the high rate of temporary employment and an insufficient fall in unemployment, affecting women in particular, were the main problems of the Spanish labour market in 2005. They call for changes in the production model and measures to favour gender equality.
Following the publication of data from the Survey of the active population (Encuesta de Población Activa, EPA) for the fourth quarter of 2005, drawn up by the National Institute of Statistics (Instituto Nacional de Estadística, INE), the largest trade unions - the Confederation of Workers’ Commissions (Comisiones Obreras, CCOO) and the General Workers’ Confederation (Unión General de Trabajadores, UGT) - issued their respective statements on employment trends in 2005.
Employment profile
According to the EPA figures, the number of active persons (employed or available for work) increased in 2005 by 654,400 people to reach a total of 21,155,500. The participation rate rose to 57.72% of the total population, 0.98 percentage points more than in 2004. This increase was greater for women: during the last quarter of 2005: their participation rate was 46.95%, compared with 45.79% for the same period in the previous year, whereas the male participation rate was 68.95% and 68.19%, respectively. The participation rate of non-nationals (73.85%) is still significantly higher than that of the Spanish population (56.12%). This difference of more than 17 percentage points is due to the age profile of the immigrant population, with a high percentage of persons in the prime working age categories.
The number of employed/self-employed persons in Spain at the end of 2005 amounted to 19,314,300 people. In 2005, the number increased by 894,100 people, with a year-to-year employment growth rate of 4.89%. Employment increased more among women (461,200 more than in 2004) than among men (432,900 more than in 2004). The total employment rate at the end of 2005 was 52.7%: 64.37% for men and 41.5% for women.
By sector, the greatest increases in year-to-year growth were in construction (6.78%) and services (6.17%). In the construction sector, there was a slow-down in growth in the last few months of 2005. In agriculture, there was a far lower year-to-year growth in employment (2.47%), while, in manufacturing, employment declined by 0.37%.
The number of unemployed people fell by 239,800 to a total of 1,841,300 people in the last quarter of 2005. The unemployment rate is 8.7%, compared with 10.56% at the end of 2004. Although the unemployment rate of women is still higher than that of men (11.61% and 6.64%, respectively), in 2005 unemployment was reduced more among the former than the latter (2.94 and 1.12 percentage points, respectively).
In the fourth quarter of 2005, there were 15,841,600 employees in Spain. Of these, 10,491,300 had a permanent contract and 5,350,400 had a temporary contract, which represents a temporary employment rate of 33.77%. In 2005, the number of employees increased by 896,000, with 337,200 of those on permanent contracts and 558,800 on temporary contracts. The percentage of wage earners was slightly above 82%.
During the last quarter of 2005, there were 2.3 million part-time employees: 1.8 million women and 0.5 million men. Part-timers represent 12% of the workforce.
Trade union response
According to CCOO, the reduction in unemployment in 2005 was significant but insufficient. CCOO considers that the EPA figures show the structural problems of the Spanish labour market: high unemployment, especially among women (who represent 59.5% of those unemployed), and an excessive use of temporary recruitment.
CCOO considers that it is essential to change the current model of economic growth, and that all public and private efforts should be aimed at investment in production, in activities with greater added value, and in the training and qualification of workers. It also believes that it is vital to establish policies eliminating the differences between men and women in the labour market.
Though temporary employment is one of CCOO’s main concerns, it recognises that it will be difficult to reduce it in the current situation of employment growth in the construction and service sectors and job losses in manufacturing. This climate favours an increase in part-time employment and the temporary or irregular recruitment of non-nationals in particular. CCOO views the contribution of immigrant workers to the Spanish economy positively, but it is concerned that the unemployment rate of immigrants is greater than that of Spanish workers and that the temporary employment rate of immigrants is rising. It considers that there is an intensive and misused recruitment of non-nationals, which is a disincentive to changing the current production model based on low labour costs and unstable employment.
UGT cautioned that attention should be paid to the slow-down in the rate of employment growth in the last quarter of the year. In that period, there was also an increase in the unemployment rate, particularly among women, further increasing the differences between Spain and other countries in the euro zone in this regard.
The UGT is also concerned about job losses in the manufacturing sector and the high temporary employment rate in Spain. It believes that priority should be given to establishing a commitment by companies to maintain an increase in permanent recruitment and decrease in temporary recruitment.
It referred to the assessment made by the European Commission on 25 January 2006 concerning the National Reform Programme presented by Spain for achieving the Lisbon Strategy, which identified the weaknesses of the Spanish labour market. The report of the European Commission calls for certain changes that favour the incorporation of women into the labour market and a decrease in temporary employment. These changes include lifelong training, the reduction of unemployment among young people and other groups threatened with exclusion, and the introduction of measures aimed at achieving gender equality, work-life balance, flexibility, stability, and health and safety at work.
In the National Reform Programme (Programa Nacional de Reformas), Spain has set itself the target of achieving an employment rate of 66% and a female employment rate of 57% by 2010. The UGT considers that the fulfilment of these objectives will necessitate important changes in the Spanish production model, greater investment in R&D, and higher quality employment.
Commentary
In 2005, the construction sector and the service sector continued to be the leaders in job creation in the Spanish labour market. However, in late 2005, the construction sector began to show signs of a slow-down in growth, which may signal the end of a period in which the economic prosperity of Spain contrasted with the difficulties of other countries in the euro zone. The negotiations on the reform of the labour market between the trade unions and the employers, therefore, represent an excellent opportunity for dealing with possible future problems. The tendency of the last reforms does not seem to indicate that measures will be introduced to restrain temporary recruitment, so permanent employment will continue to depend on the success of the economy and collective bargaining processes. It is thus understandable that the trade unions are concerned about the fall in employment in the manufacturing sector, where trade union membership and influence is greatest. Trends in the Spanish economy suggest that employment tends to be concentrated in services, which will pose a challenge for the trade unions in their efforts to improve the quality of employment. (Pablo Meseguer Gancedo, QUIT-UAB, Spain)