Spain will not reduce the level of unemployment in its labor market below 10% until at least 2025. The barrier was overwhelmed in the financial crisis of 2008 after the bursting of the real estate bubble and the collapse of the construction sector, which was the pillar of employment.

Since then, 14 years ago now, unemployment rose to almost 25% in 2013 and then fell at a slower pace to current levels.

Taking into account the circumstances that the economy is going through, with a very high degree of uncertainty, the update of the Stability Program presented yesterday is very optimistic in terms of employment.

While the economic growth forecast for the next four years has stopped dead, job creation is accelerating.

Previous forecasts established unemployment of 12.7% of the active population in 2024 and the update presented yesterday lowers the level to 10.6% to fall to 9.6% in 2025.

The successive crises experienced in recent years have led to the postponement of the objective of reducing unemployment below 10%, which in 2019 was expected to arrive this year, in 2022. Sources from the Ministry of Economy indicate that, despite what it suggests the trend of economic growth, employment is behaving better than expected and, in fact, the 2021 financial year ended up exceeding the forecast.

Thus, the improvement in the labor market leads the economy to advance to 2022, two years, the unemployment objective that it had set for 2024.

The labor market currently has just over 3.1 million unemployed and it will very likely end this April exceeding the barrier of 20 million affiliates with tourism as one of the main engines and, more than a decade later, the construction adding to job creation.

Added to the foregoing is the fact that the labor reform that entered into force last March is generating a notable transformation of the labor market that consists of minimizing temporary hiring to replace it with different types of indefinite hiring through Discontinuous fixed contracts, workers who previously went from activity to unemployment and vice versa with great ease will now have an indefinite contractual relationship even if they are in a period of inactivity.

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