The global Covid-19 pandemic has deeply affected the Spanish labour market with a severe and systematic impact on youth employment. Young people are the group that has most acutely affected by the effects of the effects of the economic slowdown resulting from confinement. This is reflected in the fall in the activity rate (which measures the proportion of young people the proportion of young people who have a job or are actively actively seeking employment) and the fall in the employment rate fall in the employment rate.
Spain has sought to reverse this situation, on the one hand, by supporting the reduction of temporary employment, which, reduces competitiveness and productivity due to lower invest in staff training. On the other, the county is promoting a fairer and more efficient labour relations model by implementing an ambitious reform comprising changes endorsed through social dialogue.
From the outset of the COVID-19 pandemic, the government of Spain has implemented a series of employment related measures (by Royal Decree-Law 8/2020, of 17th March[1]) that include more flexible processing of employment regulation procedures to enable access to unemployment benefits for all workers affected by temporary lay-offs, even if they don`t have the minimum period of contribution required. The reform also stipulates that the duration of the suspension or reduced working hours is not taken into account for the purposes of consuming maximum legal periods.
Also, for temporary lay-offs due to force majeure, companies are exempted from paying 75% on social security contributions. This reduction can even rise up to 100% for companies with less than 50 employees, provided they commit to maintain the jobs.
With regards to the Spanish Youth Guarantee,which is an initiative framed within the 2020 National Youth Strategy oriented towards reducing high levels of unemployment and to facilitate the labour insertion of young people, the Royal Decree-Law 2/2021 facilitated the registration of unaccompanied foreign minors who can prove that they are unaccompanied. Moreover, it established an exception to the requirements for receiving assistance when this contributes to keeping a job.
Also, following publication of the new Council Recommendation of 30th October 2020[2], on 8th June 2021, Spain passed the Plan Garantía Juvenil Plus (Youth Guarantee Plus Plan) 2021-2027 for decent work for young people[3]. The Plan consist of 69 measures to create quality jobs with decent conditions, including personalized guidance to promote an active search for work, training, access to employment opportunities, equal opportunities, entrepreneurship and improved management. The Plan is in the process of being implemented.
On 30th April 2021, the government of Spain published the “Recovery, Transformation and Resilience Plan”, a key instrument that will guide the channeling European funds to rebuilt the country after the Covid-19 crisis. Component 23 of the Plan, New public policies for a dynamic, resilient and inclusive labour market, focuses on investments on Youth Employment (C23.I01) through a series of interventions targeting young people (aged 16 to 30 years old), including:
Finally, to comply with the reforms identified in the aforementioned Recovery, Transformation & Resilience Plan, the Royal Decree-Law 32/2021[4] was passed in December. It amends specific provisions of the Statute of workers Rights to reduce job precariousness and over-use of temporary employment.
Among other issues, it prioritizes permanent contracts, restricts fixed-term contracts to specific cases (with an explicit qualifying cause), and stipulates that fixed-discontinuous contracts can be used for work related to seasonal or seasonal productive activities or those with know periods of execution.
Moreover, the Decree created the Red Mechanism for Employment Flexibility and Stabilization. Once activated by the Council of Ministers, this mechanism will allow companies to apply for measures consisting of reduced working hours and suspension of employment contracts. It will also enable them to claim exemption from paying social security contributions provided they provide training to each affected person to help them improving their professional skills and employability. This exemption requires the employer to keep the job open for six months after the validity period of its temporary labour force adjustment plan ends. All these measures are aimed at opening up opportunities in the professional and training fields for all young people.
The impact of the reform on permanent contracts is worth highlighting: In June 2022, 783,595 permanent contracts were registered, a 353.30% year-on-year increase. In cumulative figures, there has been an increase of 2,324,951 (242.97%) over the same period in 2021[5].
In conclusion, we can say that despite the fact that the covid 19 pandemic has deeply affected young people, all the above-mentioned measures adopted by the government, to which we can add initiatives such as GJ+, seek to increase labor market insertion and opportunities for this group and to achieve stable and quality jobs.
[1] Royal Decree-Law 8/2020, of 17th March, on extraordinary urgent measures to deal with the economic and social impact of COVID-19 (https://www.boe.es/buscar/act.php?id=BOE-A-2020-3824)
[2] COUNCIL RECOMMENDATION of 30th October 2020 on a Bridge to Jobs: Reinforcing the Youth Guarantee. It replaces the Council Recommendation of 22nd April 2013 on establishing a Youth Guarantee (https://eur-lex.europa.eu/legal-content/ES/TXT/PDF/?uri=CELEX:32020H1104(01)&from=EN)
[3] The Resolution of 24th June 2021, of the Secretary of State for Employment and Social Economy, publishing the Agreement of the Council of Ministers of 8th June 2021, approving the Youth Guarantee Plus Plan 2021-2027 for decent work for young people (https://www.boe.es/diario_boe/txt.php?id=BOE-A-2021-10587)
[4] Royal Decree-Law 32/2021, of 28th December, on urgent measures for labour reform, stable employment guarantee and transformation of the labour market (https://www.boe.es/buscar/act.php?id=BOE-A-2021-21788)
[5] Data from National Public Employment Service records: job seekers, unemployment, contracts and unemployment benefits. June 2022 (https://sepe.es/SiteSepe/contenidos/que_es_el_sepe/estadisticas/datos_avance/datos/datos_2022/AV_SISPE_2206.pdf)
Article
