Spain: Unemployment rate increases to two-year high in Q2 on Covid-19 fallout
July 28, 2020
The jobless rate climbed from 14.4% in the first quarter to a two-year high of 15.3% in the second quarter, reflecting the labor market fallout from the strict lockdown measures put in place to curb the spread of Covid-19. The figure came in below market expectations; that said, it masks the full extent of the crisis by not counting those under temporary furlough schemes as effectively unemployed and not reflecting the more than one million workers who were classified as inactive as they were unable to actively look for work. In absolute terms, the number of unemployed workers stood at 3.37 million, above the 3.31 million recorded in the previous quarter.
Jobs were lost across all major sectors of the economy, with the services segment shedding the most jobs (-816,900) as the vital tourism industry saw activity grind to a standstill. This was followed by the industrial (-127,000), construction (-108,700) and agricultural sectors (-21,400), leading to a total of 1.07 million jobs lost from the prior quarter—the largest drop on record. Meanwhile, temporary and permanent jobs were down 671,900 and 361,400 in Q2, respectively. For its part, the total workforce declined by 1.02 million people in Q2 to a total of 22.0 million.
Author: Javier Colato, Economist