The worst DANA of the 21st century in Spain reached the Valencian Community and Castilla La Mancha on October 29, and the following days in Catalonia and Andalusia, hitting the homes and businesses of thousands of people who will have to start from scratch. Tragedy marks culmination of an abnormal year for small and medium-sized businessesand self-employed workers.
Despite strong economic growth, Cessations of activity in all these groups are abnormally high in 2024in accordance with European standards. The deterioration in the figures with which the year will end is now very difficult to quantify, but the players involved fear the worst.
From the Chamber of Commerce of Valencia they communicate that Thousands of commercial premises, warehouses and basements were flooded. In addition, the small businesses and stores that managed to withstand the bad weather were later the most punished due to the thefts and looting that took place, as well as the industrial areas, which remain practically deserted when night falls in the town of Turia. .
The actors involved remain on alert due to the aid allocated by the Government to companies affected by DANA, which for the moment, the economic sources consulted by elEconomista.es find them insufficient: “At first glance, 10.6 billion seems insufficient compared to the scale of the tragedy,” explain the sources, who confirm that they will carefully analyze the details of the measures published in the Official State Gazette (BOE).
At the stores they ask for calmbecause the replacement of stocks, the renewal of specialized machines to restart commercial activities and the cleaning of industrial premises and warehouses, will be slow and there is no set deadline for restarting the economy. This all has to do with the time it will take to rebuild flood-affected highways and roads.
The sectors hardest hit by DANA
The Valencia Chamber of Commerce has made available the data available on theThe economic figures of companies affected by DANA, a total of 48,722.
The services sector is the most affected with 38,431 companies affectedled by commerce, transport and hospitality, which has 18,425 companies concerned, followed by professional and technical activities (6,183); other personal services (5,076); education, health and social services (3,183); real estate activities (2,540); financial and insurance activities (1,085), which is almost on par with other unspecified services (1,069); and the least affected were information and communications companies (694).
After the services sector, there is the construction sector, with 5,998 companies concerned; and finally the industrial sector (4,119 companies concerned by Dana). These figures, which take into account 68 municipalities affected by DANA in the Valencian Community, with the exception of Utiel and Requena due to lack of data, represented in 2022 some 67.5 million euros of GDP, which represents 32.3 % of total GDP. of the Valencian Community; and they employed a total of 1.07 million people, which represented 24.7% in the Community.
Despite the exceptional situation experienced by the Spanish economy due to DANA, The data for small and medium-sized businesses and the self-employed over the past year was already gloomy before.since Spain lost 4,093 small and medium-sized businesses, those that represent 90% of the country’s economic fabric, which could have a great impact on the economy. Additionally, the country also saw a decrease of 90,000 self-employed workers over the past year, representing a decrease of 8.65%.
The companies most affected during the year were those with 1 to 2 employees and those with 3 to 5 employees.since they are the only ones to have recorded a decrease over the period analyzed. And even if the others remained stable or increased, the losses were greater than the birth of new SMEs.
Trade sources point out various factors that lead to this decline in the economic fabric. However, they all agree on the fact that the growing fiscal pressure on the sector (in the form of taxes and contributions), combined with the instability of labor legislation, is stifling a multitude of small businesses, despite a strong economic growth. These sources give as an example “the pernicious effects of the continuous and unilateral increase in the minimum wage” since 2019, which affects the entire “salary table of entire sectors”. Another increase in the SMI is planned for 2025, which will cause even more difficulties for thousands of businessmen.
Among those with a smaller number of workers (1 or 2), 7,251 disappearedwhile among those with between 3 and 5, a total of 773 have ended their economic activity, a figure that gives respite to companies of this size.
The small and medium-sized businesses that have managed to survive the most over the past year are those that are between 6 and 9 employees (138,910 in 2024 and 138,425 in 2023); and the largest within small and medium-sized companies, which are those that have between 50 and 249 workers in their ranks, although they have obtained an increase (27,875 in 2024 and 27,477 in 2023), the increase figure is the lowest of those analyzed.
The analyzed statistics also show data relating to companies with 250 to 499 workers and those with more than 499 workers, which, generally speaking, are those that have changed the least, going from 5,516 in 2023 to 5,752 in 2024.
Sectors that closed the most businesses
By sectors, The one that had to close the most businesses last year was that of trade and vehicle repair, which paradoxically will be essential for the year 2025 due to the devastating consequences of DANA, which destroyed the personal and professional vehicles of thousands of people. In 2023, the automotive sector had 289,574 SMEs in Spain, while in September 2024 it reduced its figure to 284,493, a decrease of 5,081 companies in the sector. In second place is the manufacturing industry, which lost 1,615 companies last year, going from 97,157 in 2023 to 95,542 in 2024.
In last position on the podium are agriculture and livestockwhose activity was marked by the demonstrations called in the first months of the year and which lost 1,312 companies (90,723 in 2023 and 89,411 in 2024); and which is now affected by flooding in Spain.
On the other hand, the document provided by the Spanish government shows that theThose that have managed to increase the size of the sector the most by 1,216 companies are companies dedicated to education.which had 33,575 companies in 2023 and in 2024, they increased to 34,791. With those in the transport sector (growth of 1,199 companies) and real estate (increase of 803 companies), these are those which experienced the stronger growth. The latter foresee a further increase or, at least, better results, since new houses will have to be repaired or built in the areas of the Valencian Community, Castile-La Mancha, Andalusia and Catalonia, the most autonomous communities affected by DANA.
SMEs are decreasing and workers are increasing
Even though the number of small and medium-sized businesses decreased between September 2023 and 2024, The number of workers in these companies increased by 118,306 employeesincreasing from 9,083,620 in 2023 to 9,201,926 in 2024. As expected, those with 1 and 2 and 3 to 5 workers were the ones who lost the most employees, with 9,564 fewer in the first and 4 278 in the seconds.
Despite this, Those who have created the most jobs are those with between 10 and 49 workers, which generated up to 77,767 jobs during the period analyzed, followed by those with between 50 and 249 workers, who managed to integrate up to 51,049 people into their workforce. In last position are those with between 6 and 9 employees, which in addition to being those who have stayed the longest, have managed to increase their workforce by 3,337 workers. The good employment data are due, in part, to labor reform which reduced the duration of temporary contracts and forced those in place to be permanent. This type of hiring is therefore the one that increased the most during the period analyzed. In addition, employees of small and medium-sized businesses with a 40-hour working week also did so.
Spain loses 1,000 self-employed workers per day
The latest Labor Force Survey (EPA) published last October showed very worrying data for self-employed workers in Spain.
It is because, In the last quarter, the self-employed group recorded a loss of 87,800meaning almost 1,000 self-employed workers were lost every day over the last quarter. The EPA indicates that of the 21,823,000 people employed in Spain, 3,150,200 are self-employed. As demonstrated by the Labor Force Survey in its report presented last month, corresponding to the third quarter of the year, job creation has slowed considerably in recent months, since, if we look at the data over one year, employment increased by 2.98% in the first quarter, 2.01% in the second and a discreet 1.76% in this third quarter.
The data for September and presented last October already showed that small and medium-sized businesses were going through an abnormal period in Spain, aggravated by the floods, because This situation will worsen in the autonomous communities affected by DANAsince hundreds of companies and self-employed workers will have to face expenses that they did not have and that they had planned, which could force these companies to “lower the blinds” or paralyze their activity for a certain time until the situation can completely normalize.
