Article published by Mr. José Carlos Francisco Díaz in La Gaveta Económica in the June 2016 issue.
Since the crisis opened its jaws back in 2008, employment was swallowed up unstoppably until approximately 2013, reaching unemployment figures higher than 33% of the active population.
Since then, we have been creating jobs at a rate of about 20,000 new jobs per year, which has brought the unemployment rate in the Canary Islands to 26%. It is logical in this context that the great concern of society has been unemployment. However, a recent study by the CEOE for Spain concludes that:
1.- Population projections suggest that Spain will be one of the countries where population aging will be most pronounced. According to United Nations forecasts, in 2050 Spain will be the second oldest country in the world, only behind Japan.
2.- For the coming years, the INE forecasts indicate that the decline in the population and its aging process will continue. These factors, together with the expected recovery of the economy in the coming years and its consequent job creation, will favor a notable reduction in unemployment figures.
3.- In the short term (until 2017), the unemployment rate could be below 18%. In the long term (2025), the unemployment rate would be at 8%, pre-crisis levels.
These population dynamics contribute to reducing tensions in the labor market. However, in the medium and long term they raise a series of uncertainties due to their effects on the growth potential of the economy and their implications on the relationship between employees and pensioners, that is, the sustainability of the pension system.
Given this panorama, at Corporación 5, we are making estimates for the Canary Islands economy until 2030. Everything indicates that the “Demographic Law” that doubled the population of the islands every 50 years, has been broken and that a new era is already here. It is likely that this new population dynamic will help solve part of our unemployment, but it will generate other problems, among which is the maintenance of a generous welfare state.
In the next article, we will be able to answer more precisely for the Canary Islands the answer to the question: will demographics solve the unemployment problem?, although it is certain that it will alleviate it. But like pharmacology, some remedies for one disease (unemployment) can aggravate others (debt, pensions, growth).
