Four out of ten permanent contracts come from a permanent contract, the highest rate since 2011

Four out of ten permanent contracts come from a permanent contract, the highest rate since 2011

Randstad, number 1 in human resources in Spain and in the world, has studied the evolution of contracts converted into permanent contracts both over the last decade and over the months of this turbulent year 2020. monthly and cumulative data for October published by the State Public Employment Service (SEPE).

Randstad points out that 38.9% of indefinite contracts that have been signed so far this year in our country come from a temporary contract, the highest percentage since 2011, when it was 41.5%, and that it had been growing for consecutive years. uninterrupted. These data assume that, despite the general decline in hiring due to the economic crisis, the trend of temporary work as a gateway to permanent employment continues to consolidate.

Evolution of the CDI conversion rate

Source: Randstad based on SEPE data

For its part, the volume of contracts converted from temporary to permanent is 507,382 until October, or 28.3% less than the same period last year, when 707,172 conversions were signed. Despite the notable drop, this year’s volume is similar to that recorded in 2016, when the number of contracts of this type was 479,401.

Evolution of contracts converted into CDI

Source: Randstad based on SEPE data

Looking back at the data for the last decade, we see that this labor market indicator remained stable until 2015, below the 400,000 contracts converted. Since then, three years of brutal increases of around 20% have followed one another until 2018, exceeding 708,000 conversions from temporary to permanent, the highest volume of the period studied. Already in 2019, a change in trend was perceived, with a slight drop of one tenth, while the current year the drop was 28.3%, influenced by the crisis derived from the pandemic.

“The total number of permanent contracts and those resulting from conversion has grown steadily since 2014, but this trend has been halted by the onset of the pandemic and the resulting economic crisis. But what has not declined, but rather maintains its growth trajectory, is the conversion rate. We therefore expect that, as employment picks up, the volume of conversions will continue to increase. In addition, it is a good figure that in some communities almost half of open-ended contracts continue to come from a fixed-term contract, reflecting that temporary work is a gateway towards stable employment ”, explains Valentn Bote, Director of Randstad Research.

The volume of contracts converted has doubled since April

The Randstad study also wanted to analyze the evolution of the volume of contracts converted to CDI on a monthly basis over the last year. October 2019 registered the highest number of conversions during the period studied, from which it started to register a negative trend, except for the months of the Christmas season. The months of April and May of this year, the hardest months of the crisis in terms of employment, recorded the worst conversion figures, hovering around 26,000 contracts.

Monthly evolution of contracts converted and conversion rate over the last year

Source: Randstad based on SEPE data

Since then, the conversion to CDI has grown steadily, with the exception of August The number of temporary converted contracts converted to CDI in October of this year, 56,690 signatures, is 120.8% higher than recorded in April 25677.

More than half of the permanent workers in the industry come from a

The professional activity sector has also been the subject of studies in the analysis of the evolution of fixed-term contracts converted into permanent contracts. Randstad points out that more than half (54.4%) of permanent contracts signed in the industrial sector come from a temporary contract. The contracts signed for construction are also quite relevant (44.8%), followed by the service sector (37.6%). Agriculture is the sector with the lowest conversion weight, 18.8%.

Temporary contracts converted to CDI depending on the sector of activity

Source: Randstad based on SEPE data

In terms of volume, the service sector is the one where the most conversions take place, with 374,035 companies. Next come industry (77,033), construction (42,371) and, finally, agriculture (13,942). Regarding the variations compared to last year, the sector that suffered the largest decrease in the number of conversions was that of services, with a decrease of 29.6%, followed by construction, with 26.5 %. The more moderate declines are those in industry (-23.5%) and agriculture (-22%).

Cantabria, Galicia and Extremadura, at the top of the conversion rate

The Randstad study also took into account the autonomous community of professionals. In this way, it emerges that Cantabria (48.3%), Galicia, Extremadura (both with 47.2%) and Aragn (47.1%) are the autonomous communities with the highest rate. high conversion of temporary contracts into CDI, all with percentages above 47%.

Volume and weight of contracts converted into CDI by local authorities

Source: Randstad based on SEPE data

With more moderate rates but still exceeding the national average (38.9%), we find Asturias (46.8%), Andalusia (46.3%), Castile and Len (45.8%). %), La Rioja, Navarre (both with 45%), the Canary Islands (44.8%), the Valencian Community (44.3%) and Castilla-La Mancha (41%).

Below the rate for the whole country are the Basque Country (38.3%), Catalonia (36.95), the Balearic Islands (36.6%), the region of Murcia (32.3%) and the Community of Madrid (27.7%).

At the provincial level, Burgos (53.3%), Cuenca (53.2%), Palencia (52.9%), Huelva (52.2%) and Soria (52.1%) have the highest weights of contracts converted, registering more than 13 percentage points above the national average. On the other side of the coin, Albacete (28.2%), Barcelona (34.8%), Almera (35.5%), Vizcaya (35.8%) and Girona (38%), are the provinces with the lowest conversion rates in the country.

Regarding the number of converts, Catalonia (97360), the Community of Madrid (74868), Andalusia (72140) and the Valencian Community (60432) are the regions with the highest volume of contracts of this type, representing 60.1% of total countries.

Regarding the variations compared to 2019, the communities that experienced the least pronounced declines were Extremadura (-16.2%), Aragn (-17.5%) and Cantabria (-18.3 %), all less than -20%. With less moderate declines but still below the national average (-28.3%), there is La Rioja (-21.1%), Asturias (-21.4%), Castilla y Len (-23, 1%), Navarre (-24%), Region of Murcia (-24.9%), Castille-La Mancha (-25.1%), Galicia (-25.2%), Catalonia (-26.3% ) and the Valencian Community (-27.7%).

For their part, the strongest declines occurred in the Balearics (-45%), the Canaries (-39.1%), Andalusia (-30.9%), the Basque Country (-29.9%) and in the Community of Madrid (-29.6%).

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