The lack of workers is beginning to be a reality in most business sectors of the Spanish economy. According to the activity survey of the Bank of Spain, the percentage of companies with difficulties in recruiting employees soared from 13.2% to 27.2%, in the last quarter of the year. The rebound occurs in all business branches, but mainly in agriculture, communications and transport. Only the administrative sector is spared the labor shortage. The companies fear that this situation will cause “greater pressures on their labor costs, which would indicate that this shortage of workforce would have a reflection on the amount of salary increases.”
In some sectors of the Spanish economy, almost half of the companies have problems finding workers. These are companies with a high component of intensive use of human capital such as hospitality, agriculture and construction. Specifically, close to 40% of the companies dedicated to agriculture and construction admit that they face difficulties when it comes to hiring in the Survey of Spanish companies on the evolution of the activity of the Bank of Spain.
These are sectors that contribute 7% of GDP and that are being key in the recovery of employment. Above 30%, the branches of activity that encounter problems are hospitality (36.2%), information and communications (34.7%), and transport (31.1%). Sectors on which 20% of GDP depend and which are one of the pillars of the economy.
The data published by the Bank of Spain indicate that all sectors are under pressure from a labor framework in which there is a lack of labor. Only the administrative branch remains at the same levels as a year ago.
The agency’s survey is a survey carried out on a panel of 15,000 companies, which was carried out between November 10 and 24, just the days before concern about the omicron variant broke out in the media. The banking supervisor follows up on Spanish non-financial corporations in the current quarter and the short-term outlook. Specifically, the survey has compiled qualitative information provided by companies on their billing, their employment and the prices paid and charged. In addition, as in previous quarters, the questionnaire included questions about the main conditioning factors to which business activity is subjected and, in particular, about the impact of the pandemic.
Another interesting part of the survey is the qualitative analysis of this labor shortage situation carried out by the Bank of Spain. “The companies that currently perceive greater difficulties in the availability of labor anticipate greater pressures on their labor costs, which would denote that this shortage of labor force would have a reflection on the amount of salary increases,” the document states.
Inflationary pressures have been the main focus of concern in the recovery and the worst scenario is taking place: a permanent rise in prices that ends up damaging the economy. The governor of the Bank of Spain, Pablo Hernández de Cos, has already warned of the danger that the increase in inflation will be transferred to wages. If all these price increases translate into higher final prices and higher wages, there is a risk of generating a more severe and lasting inflationary process. “A feedback of prices and costs could be encouraged with adverse effects on competitiveness, economic activity and the well-being of citizens,” said the head of the institution.
The Bank of Spain links the problems in the supply chain and the rising cost of energy consumption with greater prospects for labor costs by companies. Yesterday he warned that most companies were going to transfer inflationary pressure to sales prices. “When additional variables are included in the regression, relative to recent evolution and short-term perspectives on costs and sales prices, a positive relationship is observed between them and expected labor costs for one year,” he explains in his analysis.
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