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ARCHIVED - 300,000 self-employed could be put out of business by the second wave of the pandemic in Spain
16 per cent of the Spanish workforce are self-employed: not only bars and restaurants are affected!
It has now become abundantly clear that the second wave of the coronavirus pandemic in Spain will be longer-lasting and far more widespread than many had hoped, and while the prime concern is of course to limit the number of lives lost there is also a growing level of alarm at the economic consequences for businesses both large and small and for the self-employed.
Forecasts are constantly being reviewed and revised as the pandemic situation develops, but the latest projection published by the ATA (the national federation of self-employed workers) is that the “second wave” will effectively put around 300,000 (or 10 per cent) of their members out of business. At the same time, another 500,000 salaried jobs are likely to be lost, according to the association, and the ATA reiterates its demand that the national government take steps to stimulate consumer spending and make more credit available.
Data published by the federation this week reveal that around 10 per cent of Spain’s 3 million self-employed expect to be going out of business while a third anticipate laying off employees as a result of the second wave. 6.5 per cent (or 210,000) have already ceased activity, among them 4 per cent who have been inactive since March, while 60.7 per cent of those responding to a survey report that although they are still in business they are operating at approximately 50 per cent of normal capacity.
Only 14.5 per cent are currently working “normally”, while the 3.7 per cent who are fortunate in that their businesses are operating more successfully than before the pandemic are the exceptions rather than the rule. As many as 84 per cent report that their turnover has fallen this year, while just 4.3 per cent report an increase.
Not just bars and restaurants!
There are widely publicized media campaigns encouraging members of the public to continue to “use them or lose them”, referring almost always to bars and restaurants, and of course with lockdown restrictions in place these businesses in the “front line” are among those most visibly under immediate threat. The arrival of cooler winter weather and the restrictions on customers indoors mean that fewer and fewer people are visiting them, and the loss of income will inevitably lead to staff layoffs and closures.
But there are a myriad of other businesses and self-employed under similar pressure, with many small high street stores threatened by falling retail sales. Major chain Zara announced last week it would be closing its high street store in Calle Mayor in Cartagena, but there are hundreds of smaller family run boutiques, shoe shops, accessory shops, ferreterías, garden centres, beauticians, stationers, tobacconists etc all under threat from reduced footfall in the high streets. Many other sectors are threatened; tourism for example not only encompasses hotels and restaurants, but also employs tour guides, all the businesses that supply food, cleaning products and services to the hostelry sector, transfer coach services, all those supplying products to the cruise ship sector, staff working in tourist attractions, most of whom are employed by small companies supplying specialist staff, all those working at airports, running the shops and coffee stands and supplying the services, market traders who have been unable to work fully with markets running at half-gas, as well as the media, which has seen sales crashing as clients shut down. The list of businesses affected and run by autonomos is endless.
In March, at the start of the first wave of the pandemic, there were 3.25 million self-employed in Spain, representing well over 16 per cent of the entire active workforce, and they are to be found in all sectors and specialities.
They therefore represent a sizeable proportion of the Spanish economy, and among those of them who employ others in their businesses some 14 per cent report that have already been forced to lay staff off, while another 28 per cent have yet to take all workers back on following the initial furlough scheme.
Only 22.8 per cent have been able to maintain all employees, and with the second wave continuing to gather momentum there is a great deal of pessimism over the future.
In fact, almost half of those questioned believe that it will take over two years for the economy to recover, and until there are signs that the second wave of contagion is beginning to slow it can only be assumed that the mood of pessimism will be hard to shake off.
This year it is anticipated that only a third of the normal levels of seasonal temporary staff will be employed for the festive season, and the lack of festive entertainment will hit those who normally rely on the festive season for the bulk of their sales such as the artisan sector, performing artists who are employed for seasonal productions and parades and all those supplying seasonal cheer.
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