Employment Trends in Spain: August Performance and Regional Variations Across the Labour Market

In the early summer campaign, results looked positive for the central figure, yet the outcome left a worrisome record on occupancy. August finished with 187,000 fewer contributors and 40,000 more unemployed, though the numbers still outperformed the pre pandemic average for many years. The economy found itself in the eye of a storm: inflation and a war in Eastern Europe clouded outlooks across the continent. After a quick rebound in employment following the pandemic, Spain’s labor market cooled, entering a typically dynamic second half of the year with a slower tempo.

Data for August, a month historically challenging for employment figures, gained more reliable footing thanks to a new labor reform. Permanent contracts continued to rise, and employment broadly showed steady improvement. These are the key takeaways from the membership data published this Friday by the Ministries of Labor and Social Security. [Source: Ministries of Labor and Social Security]

Employment dips, yet remains less severe than during the covid peak

Only one August has elapsed since statistics began in nineteen ninety six. August 2020 marked a pandemic-driven rise in employment in Spain. Typically, the last month of the tourism season brings a setback, and this year inflation added pressure at both ends. Yet the data offer several interpretations. On one hand, the fall in employment was less pronounced than July, when the labor market began to slow. With the exception of the 2020 and 2021 pandemic years, this August did not stand out as particularly bad. In short, it was a comparatively mild month for employment. [Source: National Labor Statistics]

End of summer accelerates employment slowdown: 187,000 fewer jobs in August

Microdata also provides a cautious view, noting that more than 260,000 workers left the payrolls by month’s end. The total affiliate count slipped to just under 20 million. The last days of August typically see higher contract terminations, but this period proved exceptionally active. The restructuring signals that employers may anticipate further reductions in staff levels. [Source: Labor Market Microdata]

Unemployment rises but remains at its lowest level since 2008

As with employment, August brought a rise in unemployment, though at a slower pace than in the pre covid years. The government has stressed that the recovery remains fragile. Still, the year to date has managed to keep unemployed numbers under three million, a benchmark not seen since before the global financial and real estate crisis. Spain continues to bear the highest unemployment rate in the European Union, and around four out of ten unemployed do not receive any aid or EU subsidies. This context frames the current episode in the labor market. [Source: Government Labor Office]

Private sector dynamics and variations

The private sector, including education, again pulled the overall membership downward in Spain. Roughly four in ten missing workers were teachers, supervisors, dining hall staff, or other education sector profiles. This trend traces back to the end of covid-era supplements for schooling and centers. Some of this employment typically recovers in September with the start of the academic year, but the current labor reform has not yet fully offset that temporary dip. [Source: Sectoral Labor Data]

Contrary to prior years, the hospitality sector did not contribute to a stronger decline and even showed a small uptick in August. The overall employment decline, however, kept a seasonal rhythm, with declines in trade due to reduced city activity during the holidays. Construction weakened further as hot August temperatures and energy cost pressures weighed on activity. In manufacturing the impact of rising energy costs was evident as well. [Source: Economic Activity Report]

Self-employment falls but covid-era resilience persists

Self-employed workers registered with RETA declined by 13,509 compared with July, bringing the total to about 3.3 million. The drop was smaller than the sharp falls seen between 2016 and 2019, when roughly 16,000 to 17,000 self-employed records were extinguished in those periods. This softer trajectory underscores a relative resilience among independent workers in August. [Source: RETA Registry]

Catalonia shows the strongest monthly deterioration in jobs

In Catalonia, August closed with 9,554 more unemployed people than the prior month, pushing the regional total to 350,945. The end of the tourist season and related agricultural activity in Girona and Tarragona contributed to layoffs typical of a difficult month for jobs. Yet the national picture mirrors the broader trend: the current data are worse than the pre-pandemic average in most years. [Source: Catalan Labor Stats]

Unemployment rose in 13 of 17 autonomous communities. Andalusia and Catalonia led with the highest increases, while Madrid recorded fewer new unemployed individuals than Catalan provinces contributed to SEPE’s totals. By the end of August, active employment in Catalonia stood at 3.59 million, a substantial figure but still below the pre-pandemic average. Catalonia’s downturn outpaced other regions, with Madrid posting a smaller loss as the tourist season waned. [Source: Regional Labor Reports]