Economic rebound in Alicante: sectoral gaps and growth drivers in 2024

Employment in Alicante has rebounded quickly after the darkest days of the pandemic, yet the recovery is uneven across sectors. The industrial sector, in particular, shows a troubling trend: employment is about 5% below 2019 levels, weighed down by higher energy costs, pricier raw materials, and ongoing global economic uncertainty. The agricultural sector faces a similar headwind, with roughly 25% fewer workers than before the crisis, influenced by European market restrictions tied to the Ukraine war and recurring adverse weather. By contrast, the construction and services sectors are showing stronger occupancy rates, driven by solid housing activity and a revived tourism industry.

New data from the National Institute of Statistics indicate that Industry in Alicante Province now employs about 121,400 workers. This marks a 21% improvement over 2021, yet it remains 5% below 2019. Inflation and related pressures continue to explain part of this gap. As Marián Cano, president of the Valencian Footwear Entrepreneurs Association, notes, the footwear industry was among the hardest hit by pandemic restrictions, leading to a steep drop in occupancy. Since then, rising costs and persistent economic uncertainty have challenged competitiveness, which in turn slows job creation.

Luís Rodríguez, president of the Alicante State Federation of Metal Companies, stresses that adjustments persist. While some firms have embraced innovation and technology, others lag behind. A key factor affecting employment is the lack of specialized workers across several activity areas, highlighting the urgency of strengthening education and workforce training.

Pepe Serna, president of the Valencia Community Textile Entrepreneurs Association, underlines the sharp rise in energy costs for companies in the finishing sub-sector. This pressure has paused some production lines and driven recourse to Temporary Employment Regulation Files. There is a call for government assistance to extend sectoral relief to textile activities.

Agriculture

Agriculture trails the region in job creation, with about 18,700 workers provincewide, the same level as last year but 25% below pre-crisis figures. José Vicente Andreu, president of Asaja Alicante, distinguishes the current downturn from the pandemic period, reminding that agriculture was perceived as a strategic essential activity during the crisis and managed to endure more robustly than many other sectors.

Another reality shaping employment is the shifting supply chains for citrus and other fruit. The war in Ukraine has redirected trade flows, with some substitutes entering European markets and impacting local demand. Adverse weather, including heavy spring rains, has also affected harvest levels and reduced labor needs in some sub-sectors.

Raw material costs and delays burden the manufacturing industry

The reasons behind the softer occupancy exceed just labor supply. The Ukraine conflict has influenced citrus production, as countries like Turkey filled markets closed to Russian imports, increasing competition for Alicante growers. Simultaneously, bad harvests caused by weather events have lowered production needs and reduced labor demand. This combination of higher input costs and volatile harvests continues to challenge manufacturers across the province.

On the other side of the ledger, construction and services show resilience. The current workforce stands at 62,300 in construction, up 28% from 2021 and 10% above 2019, supported by steady demand for housing and renewed buyer activity. Tourism-focused services, driven by international visitors, employ about 610,400 people, up 5% from the previous year and 4% above pre-pandemic levels, reflecting a strong rebound in visitor activity.

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