Does the increase in discontinuous fixed make up the unemployment figures?


The leader of PP, Alberto Nunez Feijooconsiders that the Government is “making up the unemployment data“, because now it does not include “the discontinuous fixed”. And they are not few, as he stated in an interview this Thursday on Onda Cero, but “about 700,000” people who, according to him, previously appeared on the unemployment lists and now, with that name change, they do not. The Ministries of Labor and Social Security have updated the registration and unemployment data for the month of May, as they do every month, among which it stands out that the total number of unemployed has fallen below three million people for the first time since 2008. But, what? How does the recent increase in discontinuous fixed rates influence the statistics?

What is a discontinuous fixed?

The figure of the discontinuous fixed is not new and has existed in the Spanish labor law for decades. However, the labour reform agreed between the Government, the employers and the unions limits temporary hiring and intends to redirect part of that employment towards the discontinuous permanent figure. To locate the dimension of the same, in the five months that the labor reform has been in force, a total of 683,300 contracts of this type, according to public data from the SEPE. In the same period of 2019, 98,026 were signed, that is, seven times less.

But what is a discontinuous fixed? You are an employee hired by a company but who works intermittent. In other words, the employer only calls said employee to work at times of greatest activity or demand. The discontinuous fixed-term contract has the character of undefined and explains, in part, the substantial increase in permanent contracts experienced in recent months.

A common case was Waiters either workers of hotel. The hotel had a permanent staff to attend to the business throughout the year, but in the event of peaks in activity in winter or summer, it activated an extra group of non-continuous permanent workers. He had already hired them previously and they knew the business, but it did not make sense for him to have an oversized workforce throughout the year. While they were not active, they did not quote, nor did they collect from the company, but the company had the obligation to call them and not other people when the season began. Notices and the minimum work period were negotiated by company or agreement.

Does a discontinuous fixture count as stopped when it is not working?

No. For a person to be officially counted as unemployed, they must meet two requirements. On the one hand, not having a job. And, on the other, to be signed up in the public employment offices (SEPE) as a job seeker. There are unemployed who are not registered and who do not count and there are registered workers who do have another job, but are registered in case an alternative job offer arrives.

The discontinuous fixed cannot count as unemployed while they have a discontinuous fixed contract, since they are formally linked to the company. And they will only count as unemployed if the company considers that it will no longer need the services of that worker and dismisses him, paying the relevant compensation.

While the discontinuous fixed is operational he contributes like any other worker to Social Security and when it ceases to be operational he stops contributing. Unless you go to work in another job, something common in some profiles, which chain one campaign to another and whose periods of inactivity are short or non-existent. Consequently, Feijóo’s accusation that the Government is making up the data by not counting discontinuous permanent workers as unemployed lacks statistical basis and, furthermore, it infers that a discontinuous permanent will only be employed in a single company and will not chain jobs throughout all or part of the year. They have never counted as unemployed and the new labor reform has not introduced changes in this regard.

Could the rise in discontinuous fixed rates have an impact on the unemployment data?

Yes, although indirectly. Many workers who today are permanent discontinuous workers used to be temporary workers. The company gave them a three-month contract to cover the summer campaign and when it was over they went out on the street and began to count as unemployed. With the popularization of the discontinuous landline, that same person will not count as unemployed, since he will continue to be linked -passively- to the company. What guarantees him more rights -such as greater compensation in case of dismissal or guarantee of being called again and not any other-. But it is true that starting in the fall, part of the discontinuous permanent workers will appear as Social Security affiliates but in truth they will not be working.

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Right now this statistical nuance has no impact on the data, since the discontinuous landlines signed now are to work now and the amount of these that is totally inoperative will be residual. In other words, unemployment has fallen by almost 100,000 people and it has been below three million people due to the inertia of recent months to generate employment. Of the last 12 months, only in two has unemployment rebounded.

Is it possible that unemployment will not pick up so much in fall when the summer ends? Yes, it is possible, since we will enter the phase in which people who are currently operational cease to be so, but do not count as unemployed. Before, if he had a temporary contract, he did compute it and at a contractual level he had worse working conditions.


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