The latest statistical bulletin from the Ministry of Labor brought signs of hope for the Spanish labor market. Between January and June of this year, permanent contracts have increased by 27% compared to the same period in 2020. Beyond the fact that these figures are marked by the irregularity involved in comparing it with the maximum confinement period of the pandemic, the truth is that this increase in fixed contracts is ten points above the storm, which remained at a rise of 17%.

Does this mean that there is a change in the trend of temporary employment in Spain, that with the recovery of the activity the permanent hiring is being encouraged? Nothing is further from reality.

In fact, these figures are but a mirage. In the first half of the year, 957,000 permanent hires were made, 204,000 more than in the first half of 2020. However, of this significant increase (27% more in relative terms, let’s remember), three quarters are fraudulent temporary contracts reconverted by the Ministry of Labor and Social Economy.

This is indicated by sources from the department headed by Yolanda Díaz. From the beginning of the year to the end of May, the Labor and Social Security Inspectorate has ‘hunted’ and transformed into indefinite about 156,000 temporary contracts.

“It’s a absolutely historical data with respect to the same reference period of previous years “, explain the cited sources. The truth is that the number of irregular temporary contracts that were transformed into permanent ones was 35,224 in 2020, with which the interannual variation is 342.6%.

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Yolanda Díaz, Second Vice President of Labor and Social Economy, and Magdalena Valerio, former Minister of Labor and President of the Toledo Pact Commission.

The fraudulent temporary contracts found by the inspection fell into infractions such as exceeding the maximum limits of duration (including the chaining of contracts) and did not comply with the legal causes for a temporary contract, among other issues.

Part of these inspections were inside of the Master Plan for a Decent Work developed between 2018 and 2020 and created by Magdalena Valerio. In total, during its 23 months of application 214,646 jobs emerged and Social Security contributions were collected for an amount of 1.8 million euros.

Statical bias

In addition, the pandemic itself has caused that in these data there is an important “statical bias“, argues Javier Blasco, director of the Adecco Group Institute. Sectors that are the main creators of temporary employment, such as services, have been lethargic in the first quarter of the year due to restrictions, so the hiring increase has been lower.

On the other hand, sectors in which hiring is usually indefinite, such as automotive, technology or communications, have returned to activity before.

However, remember that in volume temporary hires are still overwhelming majority. In fact, nine out of ten contracts signed between January and July (in total, 8.6 million) are temporary.

With everything, temporary work agencies have not escaped the impact of this crisis. In 2020, they lost about 25% of the contracts they manage, 1,007,960 fewer contracts. And according to the latest Labor data, in the first quarter of 2021 this roadmap remains with 24,700 fewer contracts than in the same period of 2020.

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At least, full-time hiring is the majority. Of the 8.6 million contracts that were made in the first six months of the year, about 5.8 million are of this modality (an increase of 15% compared to the same period last year).

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