Like a long-distance runner who tires into the miles but keeps moving, Spain’s job market shows clear fatigue in its latest signals. The July data confirm a trend that began with the June figures: job creation is slowing. It was predictable after almost three years of uninterrupted labor market expansion. Yet the inertia still carries the economy forward, and July data allow a new record to be set for the total number of active workers, reaching 20.86 million participants.
Unemployment decreased by 50,268 people, bringing the total unemployed to 2.68 million. This is the lowest tally in fifteen years, though it remains among the highest in the European Union. The figures come from the Ministries of Labor and Social Security and were released on a Tuesday, offering a snapshot of a labor market that has endured heavy headwinds while showing resilience in activity levels.
Every step in this race costs more. The workforce has faced headwinds such as persistent inflation, a long drought of wage growth, and disruptions in global trade. While many voices anticipated substantial restructuring in the summers of 2022 and 2023, when Spain posted record employment highs, speed has since cooled significantly. The economy continues to adapt to a changed pace, balancing momentum with the need for stability.
Catalonia was the leading regional contributor to employment in June, generating three times as many new jobs as any other region in Spain. The Madrid region also showed strength, reversing an early pandemic lull in its labor market. In the first part of 2023 Catalonia added many more Social Security participants than Madrid, signaling a shift in regional dynamics for the year ahead.
Schools on vacation and the impact on the numbers
The overall Spanish labor market added 54,541 new jobs in July, marking the weakest July gain since 2015. To place that in context, July 2022 produced roughly twice as many new jobs and 2021 produced about four times as many. When seasonally adjusted figures are used, which remove the cyclical effect still influential in the economy, the result is rougher: 20,119 jobs were lost in July, the first red number in a year.
Looking at the raw data, the sectors of commerce and hospitality led in new paid employment for the season. As is typical each year, education shed about 51 thousand workers during July when many substitute teachers and other staff are temporarily laid off before the start of the new school year. These staff are often rehired in September, which helps explain why summer is a quiet period for payrolls.