Spain’s Population and Labor Market: Trends and Future

Posted on Dec 17, 2024 in Geography

The Unemployment Rate

Evolution

  • Until 1973: Unemployment was not a serious problem. Population pressure on the labor market was solved by emigration abroad.
  • From 1973 to 1975: Unemployment experienced a large increase in job destruction caused by the crisis and industrial restructuring, coupled with higher labor demand (returnees, women, baby boom generation).
  • Between 1985 and 1995: Two stages: a slight decrease between 1985 and 1990 due to an improving economic situation, and an increase between 1990 and 1995 due to the crisis.
  • From 1995 to 2008: Unemployment fell due to favorable economic conditions, entry into the market for fewer generations, and legislative reforms that made employment more flexible.
  • Currently: High unemployment figures are due to increasing productivity, reducing labor, and recessionary economic times.

Variations

The unemployment rate has variations according to:

  • Gender (higher unemployment among women)
  • Age (higher youth unemployment)
  • Education level (higher unemployment among less skilled)
  • Time of year (seasonal unemployment after harvesting of crops and the reduction of hotel demand in winter)
  • Autonomous community

Economic Sectors

Primary Sector

  • Early 20th Century: Occupied the majority of the population due to the agricultural economy and society. Since then, it has come down to very low levels.
  • First Third of the 20th Century: The decrease coincided with the beginning of rural depopulation.
  • During the Civil War and its Aftermath: The population recovered as people remained in the countryside.
  • Between 1950 and 1975: Continued reduction of the population employed in the primary sector, accelerating the rural exodus.
  • Since 1975: The decline is slowing due to the halt of the rural exodus as a result of the crisis, and because the numbers are already low.

Secondary Sector

  • Early 20th Century: Occupied a small percentage. It has since been fluctuating in growth.
  • First Third of the 20th Century: Growth within the industry and public works by Primo de Rivera.
  • During the Civil War and its Aftermath: Growth was slowed by the destruction of industry, maintenance or return of people to the countryside, and the problems created in the industry due to autarkic policy.
  • Between 1960 and 1975: The workforce in this sector decreased. The economic crisis led to the transfer of part of its population to the tertiary sector. Modern industry uses new technologies that require less labor and also produces strategic outsourcing.

Tertiary Sector

  • Early 20th Century: Occupied a small percentage. It has since grown, except during the Civil War, to occupy the majority of the population.

Causes:

  • The increase in economic and living standards.
  • Changes in other economic sectors: first agricultural mechanization and industrial crisis, and the current outsourcing of industry.
  • The increase in public services: the development of the welfare state.
  • The addition of women to the workforce: childcare, domestic help.

Spatial Distribution of Employed Population by Sectors

  • Primary sector weight in Galicia, Andalusia, and Murcia.
  • Predominance of the secondary sector in La Rioja, Navarre, the Basque Country, and Catalonia.
  • Predominance of the tertiary sector in Madrid, the Balearic Islands, and the Canary Islands.

The Future of the Spanish Population

Spain has been experiencing profound demographic changes since 1975. It has ceased to be a young, native, migratory country to become a country with one of the lowest birth rates in the world, an aging population, and immigration. These changes have other social and economic consequences. This is why experts perform population projections (forecasts on the future development of various aspects of the population for a number of years). The National Institute of Statistics (INE) provides the following estimates:

The Future of Natural Movement

  • Birth Rate: Will grow for a few years due to foreign immigration. But during 2010-2020, it will decrease.
  • Fertility: Will depend on the adoption by foreigners of national fertility patterns and trends in the fertility of Spanish women, which will be conditioned by easier access to the youth labor market that could advance their emancipation and the age of marriage, and the existence of genuine equality in the performance of domestic and family tasks. The INE is planning to increase fertility until 2030.
  • Mortality: Will grow due to the constant average rates of population aging. Life expectancy will increase, although with less intensity, and will stabilize in 2030.
  • Natural Growth: Will turn negative in the 2020s.

The Future of Migration

  • Migration of the Spanish Population: Prevalence of long-distance internal migration, intraregional and intraprovincial, and low emigration abroad.
  • Foreign Migration: It is very difficult to predict, it depends on factors like the number of returns that can occur and whether Spain will be maintained as a destination for immigration. These factors will depend on the economic evolution of the country. The INE provides two scenarios for growth in immigration until 2060. To enhance the positive effects of immigration and avoid the negatives, cooperation with countries of origin should be maintained.

The Future of Growth and Population Structure

  • Population Growth: Will continue until 2050 due to immigration and then fall.
  • Structure by Sex: Boys will predominate among young people and women among the elderly. But the numerical differences between the two sexes tend to be shorter because the lifestyle of women approaches that of men in some aspects that involve a greater risk of death. To avoid this, information campaigns should be promoted.
  • Age Structure: Spain will be one of the oldest countries in the world. To alleviate the problems of an aging population, the OECD recommends delaying the retirement age, eliminating early retirement, encouraging pension funds, and a more rational use of health resources, providing support to enable the elderly to stay in their homes as long as possible.
  • Economic Structure: The female activity rate will grow until 2020. To mitigate the economic slowdown, jobs for youth and women and immigration should be encouraged. It is also necessary to combat the inequality of women in employment. Finally, outsourcing part of the economic activity will increase the proportion of people employed in the service sector at the expense of the other two.