Read news from:
Austria
SHARE
COPY LINK

UNEMPLOYMENT

Spain’s unemployment rate inches up to three million

Spain's unemployment rate edged up slightly to 12.48 percent in the third quarter of this year after declining steadily since the end of 2020, official data showed Thursday.

Published: 27 October 2022 13:37 CEST
Spain's unemployment rate inches up to three million
Some half a million people lost their jobs in 2020 in Spain, which has one of the highest rates of unemployment in the Organisation for Economic Co-operation and Development. (Photo by SEBASTIEN BERDA / AFP)

The jobless rate inched up to 12.67 percent in the period from July to September from 12.48 percent in the previous three-month period, national statistics institute INE said in a statement. Youth unemployment now stands at 31 percent.

The number of unemployed people rose by 60,800 in the third quarter to a total of 2.98 million even though 70,000 jobs were created, with most jobs lost in services, including Spain’s key tourism sector, and agriculture.

The jobless rate was still lower than during the same period a year ago when it stood at 14.57 percent.

The number of job seekers in Spain fell below three million in May for the first time since November 2008 at the start of the global financial crisis.

The fall in joblessness was due to a rebound in Spain’s tourism sector following the end of most pandemic travel restrictions and a labour market reform which limits the back-to-back use of temporary contracts.

The number of permanent contracts in Spain in the third quarter rose by 444,200.

Among Western economies, Spain was one of the worst-hit by the economic fallout of the pandemic, with its gross domestic product collapsing by 10.8 percent in 2020, largely due to its heavy dependence on tourism.

Some half a million people lost their jobs in 2020 in Spain, which has one of the highest rates of unemployment in the Organisation for Economic Co-operation and Development.

The government predicts the jobless rate will drop to 12.2 percent at the end of 2023 despite a slowdown in the economy due to soaring inflation and the uncertainty caused by the war in Ukraine.

But many analysts are much more pessimistic. Investment bank ING predicted Spain’s unemployment rate will rise steadily to 14.3 percent in the third quarter of 2023.

It expects the Spanish economy, the eurozone’s fourth largest, will enter a mild recession in the fourth quarter of 2022 that will continue until the first quarter of next year.

“Business confidence has also deteriorated sharply in recent months, which will encourage companies to be more careful with new hires,” ING economist Wouter Thierie said in a research note.

The higher share of permanent contracts, however, will cause the rise in the jobless rate to “be less pronounced than during previous recessionary periods”, he added.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

WORKING IN SPAIN

What’s the law on having two jobs in Spain?

With the current cost of living crisis, working more than one job is becoming more and more common, but what are the rules on working multiple contracted jobs in Spain and the tax implications of this?

Published: 25 June 2024 13:24 CEST
Updated: 29 June 2024 08:10 CEST
What's the law on having two jobs in Spain?

Often it’s necessary to have more than one job at a time, particularly if they don’t pay well and you’re struggling to make ends meet.

In fact, historically that is part of the reason why establishments stay open so late and why siestas were so common – because people would have one job in the morning and then go home for a rest before starting their second.

This is still commonplace today and is in fact becoming more and more popular, with the rise in the cost of living, driving an increasing number of people to take up a second job.

Whatever your reasons for having two jobs or more – to save up more money or gain extra experience and work your way up, there are some financial implications you should be aware of.

What does the law say?

Currently in Spain, there is no restriction that prevents a person from having a second job, with two contracts in two different companies, for 80 hours a week.

According to data from the first quarter of this year from the Active Population Survey (EPA) prepared by the National Institute of Statistics (INE), the number of people with a second job in Spain stands at 591,300, although according to affiliation data of Social Security, some 800,000 people have more than one position.

This trend has been seen in each quarter of the EPA since 2022 and, right now, is close to a historic number.

Categories you should be aware of

There are two types of categories when you work in multiple jobs in Spain – these are pluriempleo and pluriactividad. Pluriempleo literally means multiple employment. This is understood as a person who works as an employee in two or more companies under the same Social Security regime.

In this way, it differs from pluriactividad or multiple activities, which is when people work for others and have their own business at the same time or their second job is under a different social security regime.

For example, if you work as a hotel receptionist in the morning and then in a restaurant at night, these positions are considered to be part of the same regime, but if you work in a hotel in the morning and then as a nurse in a hospital at night, these are two different careers and therefore social security regimes.

If you’re self-employed as well as having a contract job, this is a slightly different situation. To find out more, read our guide below. 

READ ALSO – Self-employed in Spain: What are the tax rules if you do two or more jobs?

What are the tax and social security implications?

If you have two separate jobs, you are required by law to report your situation to Social Security, and to each of the companies you’re employed by.

When it comes to the Tax Agency, it’s important to note that you are obliged to submit your yearly Income Tax return (Renta), when you are paid by more than one employer and your income exceeds €22,000 per year.

READ ALSO – EXPLAINED: The key changes to Spain’s 2023/2024 annual tax return

In 2024, the maximum social security contribution base for employees has been set at €4,720.50 per month. This means, that regardless of whether your income from two positions exceeds this amount, the social security base will not be more than this.

The amount of IRPF (Personal Income Tax) must also be taken into account. If you are combining two contracts, it’s important to calculate the withholding tax.

This is because companies calculate personal income tax based on your annual compensation expectations. They do not take into account the existence of another job, so they apply the discount depending on what they are paying you only.

This means that they will keep less than what they should and when you’re filling out your Renta yearly income tax return, you will most likely have to pay the extra to make up the difference. 

In this case, you should request that both companies calculate personal income tax according to your earnings, so that you can get a good idea of the amount you have to pay working two positions.

You may also consider hiring a gestor or accountant to file your yearly tax return for you if you have a particularly complicated situation and work three or more jobs for example. 

SHOW COMMENTS