In a broad effort to modernize welfare and employment support, the Ministry of Labor is finalizing measures that help unemployed individuals access ongoing assistance while seeking work. Eligible people who register with the State Employment Office (SEPE) can continue receiving a non-contributory transfer while they pursue employment and enter new wages on a monthly basis. This reform is part of a wider public employment services overhaul that Congress approved this week with the final passage of the new employment law.
Within the government, reform of the unemployment protection system is advancing in line with the recovery and resilience framework funded by European Union resources. The plan aligns with the fourth tranche of EU funds for the year. Advocates from the Labor Party consider the reform already approved by the Council of Ministers. Sources close to discussions indicate the changes could take effect in the last quarter of the year.
The government is rolling out a new social shield designed to increase protection for people with no current income from work. The Labor Department and the Social Security Administration are introducing incentives intended to help claimants move from one state of work to another and improve re-employment prospects.
The aim is to escape what is described as a poverty trap, where individuals fear losing benefits if they take a job or cannot sustain it. Since January 1, Social Security has implemented a minimum living income IMV that allows recipients to continue collecting part of this basic income if they find a job and begin earning wages.
From one year to six months
SEPE will adopt a similar framework for aid subsidies starting in October or November. Debates within the Executive branch are ongoing, with some proposals calling for a 25 percent aid subsidy (roughly 120 euros) for twelve months. If a contract ends and a recipient must rely entirely on the subsidy again, the benefit would not exhaust the total period as long as it aligns with earned income. Other voices within the Council of Ministers favor limiting the eligibility period to six months.
There is a precedent in the active income support programs. As of February, about 19,711 people received aid under these schemes. If a recipient finds a job or begins self-employment, the subsidy payment can be paused with a maximum period of 180 days for adjustment. Knowledgeable sources note that roughly 4,000 individuals currently combine such aid with earnings.
The entire subsidy system has been explained for months by SEPE technicians with guidance from a consulting firm. Deloitte recently won a summer contract to develop software power for modernizing public employment services. In the broader push to utilize European funds, SEPE has a special budget of 170 million euros to develop internal tools and processes.
New labor law
As the government strengthens the welfare system to encourage unemployed people to seek new opportunities, it reorganizes institutions to improve efficiency and support. This week, Congress gave final approval to the new employment law, establishing a basic rights framework for the unemployed. One notable feature is the creation of a personal employment advisor for each job seeker, a kind of ongoing guidance to retrain and pursue new roles throughout a person’s working life.
The new statute also restructures SEPE into a more flexible agency around May. This change aims to ensure that every unemployed individual receives at least one job offer within a year that matches their qualifications. The law supports multi-year training programs and expands availability throughout the year, while boosting cooperation among administrations, including between SEPE and the European Union, Catalonia’s Employment Service, and Active Barcelona.
Overall, the reform signals a shift toward a more proactive, integrated approach to unemployment support, emphasizing sustained training, timely job offers, and cross-border collaboration within the EU framework. It positions the public employment system to respond more nimbly to labor market shifts and to help people move into steady, rewarding work with greater confidence.