Labour market resilience faces uncertainties in 2023

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The labour market faces a stress test in 2023 in a context of slowing growth in which it will be seen if the paradigm shift of the labour reform consolidates, after a positive 2022 in which it has returned to the level of employment prior to the financial crisis of 2008.

At the moment the year has started in negative, as usually happens in a labor market very marked by seasonality in which the end of the Christmas campaign is noticeable, although the seasonally adjusted data reveal the good tone of employment with figures above the average of other months of January.

The Minister of Inclusion, Social Security and Migration, José Luis Escrivá, insists on the calendar-adjusted figures, stressing that the year has started well despite the complicated environment.

Some private analysts from BBVA Research or Funcas also focus their reports on seasonally adjusted figures and highlight the positive evolution of a month of January in which temporary employment continued to decline.

However, both public and private analysts predict a slowdown in employment by 2023, in line with the slowdown in the Spanish economy, whose growth rate will slow down by at least half.

The Government itself predicts full-time equivalent employment growth of 0.6% in 2023, while the consensus of analysts grouped by the Funcas panel figures it at 1%, although with heterogeneous forecasts ranging from stagnation (0.1%) predicted by Mapfre (BME:MAP) Economics, up to the 2.7% advance forecast by Equipo Económica.

In the low range is Funcas, with a forecast of employment growth of 0.5%, which its director of Economic Situation, Raymond Torres, explains by a context of lower GDP growth.

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“2023 cannot maintain the same rate of job creation as 2022 in a context of lower GDP growth,” Torres told EFE, although he anticipates that it may not be a year “as complicated as was thought a few months ago.”

In his opinion, the greatest impact of inflation on the purchasing power of consumers may have already passed, while the uncertainties associated with the conflict in Ukraine are more limited than a year ago when the conflict broke out.

It will be more difficult for unemployment to fall below 3 million people again (3,024,000 at the end of 2022 according to the Active Population Survey), according to the consensus of the Funcas panel, which points to an unemployment rate of 13% of the active population in 2023 (12.87% at the end of 2022).

The government, however, estimates that the average unemployment rate for 2023 will fall to 12.2%.


The employers of private placement agencies Asempleo considers that the “resilience” shown by the labor market in 2023 has been “a statistical mirage” that hides the weakening of the private sector.

For Asempleo, the barrier of three million unemployed “seems like a magnet from which we are condemned not to move away”, which is why it emphasizes the need to stop “the wear” of the high bag of unemployment with policies that do not try to hide this problem “under the premise of reducing temporality”.

Among the companies that are part of Asempleo, the Adecco group (SIX:ADEN) predicts that during the first quarter of the year job creation will weaken, in line with what happened in the fourth quarter of 2022, and ensures that the stage of strong recovery of the labor market is over, to give way to a new scenario of “mini-growth”.

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