Unemployment Rates Decline in Spain: A Closer Look at May 2025 Employment Trends
In a positive turn for the Spanish labor market, the registered unemployment rate saw a noteworthy decrease of 57,835 individuals in May 2025 compared to the previous month. This drop, primarily driven by the services sector, marks a significant milestone with the total number of unemployed now standing at 2,454,883, dipping below the 2.5 million mark for the first time since July 2008, as reported by the Ministry of Labor and Social Economy.
The statistics reveal that since 1996, unemployment has generally declined every May with only two exceptions: during the financial crisis in 2008 and amidst the COVID-19 pandemic in 2020. The largest decrease recorded in May occurred in 2021, with over 129,000 individuals leaving unemployment rolls. In terms of seasonal adjustments, registered unemployment fell by 12,250 people month-on-month.
A year-on-year analysis shows an impressive cumulative decline of 152,967 individuals, highlighting a 5.9% reduction. Female unemployment accounted for 84,463 fewer women while male unemployment fell by 68,504 men. Once again, the services sector emerged as the strongest contributor to this trend, with a dramatic reduction of 42,930 unemployed individuals.
In sector-specific analysis, construction unemployment decreased by 5,562, followed by a drop of 4,574 in the industrial sector and a decrease of 2,259 in agriculture. The number of individuals with no previous employment also showed a positive trend, with 2,510 fewer unemployed in this category.
Gender analysis indicated that female unemployment saw a larger decline, falling by 29,066 women compared to a 28,769 decline in male unemployment. The overall female unemployment rate has thus dropped below 1.5 million, reaching 1,486,421, marking the lowest level since October 2008. Conversely, male unemployment totals reached 968,462.
Age-wise, individuals aged 25 and older experienced a decline of 51,409 in May, while youth unemployment among those under 25 saw a reduction of 6,426, leading to historic lows for this group at 171,003 unemployed.
On a regional scale, all autonomous communities recorded a decrease in unemployment, with the most significant drops observed in Andalusia (13,239), Madrid (7,923), and Catalonia (6,198).
Foreign unemployment also saw a decrease, with 9,886 fewer unemployed immigrants, totaling 342,811 unemployed individuals, marking a drop of 9,240 compared to the same time last year.
In terms of labor contracts, May saw a total of 1,328,983 contracts registered, reflecting a 0.8% decrease compared to the previous year. Notably, 552,697 out of these were permanent contracts, although this represented a 4% decrease from May 2024. While nearly 41.59% of new contracts were permanent, this was slightly lower than the 43% recorded in the same month last year.
Temporary contracts increased by 16%, comprising 58.4% of all hiring in May, with the hospitality sector leading with an impressive gain of 76,000 new contributors in the month alone.
Unemployment benefits in April totaled €19.45 billion, showing a 57% increase from the previous year, with the average monthly expenditure per beneficiary rising to €1,317.90.
The Social Security System reported an average increase of 195,736 contributors in May, driven largely by the hospitality sector, establishing a new all-time high of 21,784,375 contributors.
Minister of Inclusion, Social Security, and Migration, Elma Saiz, noted that in recent years, Spain has seen a substantial rise in employment, particularly among women and foreigners, pointing out that over 4 million workers now hold permanent contracts since the implementation of labor reforms that have significantly reduced temporary employment.
As for the outlook, there remains a notable purpose to reach 23 million contributors by 2027, reflected in a steady commitment to enhancing job quality and reducing the temporary employment rate, which has now decreased dramatically since 2018.
The data from March also pointed to a minor increase in workers affected by temporary employment regulation files (ERTEs), highlighting the ongoing need for robust economic interventions. The economic landscape remains one of growth and recovery, with increasing stability in the labor market as demonstrated by these recent unemployment statistics.
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