Extensions Of Temporary Contracts With Young People Exceed Their Conversions To Permanent Contracts

In the first seven months after the entry into force of the labor reform, 3.97 million permanent contracts were signed, 2.85 more than in the same period of 2021. But only 17% of this increase corresponds to conversions of temporary positions to indefinite .

Conversions to permanent jobs, although they have doubled to 953,250 in the last year, have lost relevance over stable employment. So far this year they have contributed 24% of the total of indefinite contracts, when in the first seven months of 2021 they reached 41.6%.

These data suggest that the labor reform has encouraged more the creation of new jobs than the improvement of pre-existing ones.

Something that seems to confirm the comparison with the extensions of temporary contracts . These have fallen from the 1.3 million they reached a year ago to 982,270 so far this year.

They still exceed by 3% those who become fixed. But it is an undeniable improvement if we take into account that a year ago the extensions tripled the conversions. Although a detailed analysis by age group reveals that this gap is still concentrated among the youngest workers.

Thus, among those under 25 years of age, extensions exceed conversions to permanent contracts by 37%.

This relationship can be expressed in another way: 58% of temporary jobs that are renewed do so under the same conditions , without becoming permanent.

On the contrary, among those over 55 years of age, the contracts that are extended are already 20.5% less than those that become indefinite .

The term of the conversions
The increase in conversions and the reduction in extensions responds to the evolution of indefinite and temporary contracts after the new regulation .

But despite its impact, and the reinforcement of the inspection activity, few changes are noted in the way in which they are proposed. Eight out of ten correspond to temporary contracts of less than one year.

When this limit is exceeded, the conversions drop, to the point that the transformation of temporary beyond the legal maximum of 36 months to extend temporary ( a threshold that, however, is exceeded by thousands of public sector interns ), have even been reduced compared to a year ago.

The contracts that have increased their conversions the most, 202%, are those with a duration of less than three months . At this point, it must be taken into account that the contracts most penalized for their termination are the shortest .

The temporary contracts that are converted are mostly those justified by production circumstances (57.9%) followed by work and service contracts (35.3%) .
This percentage is similar to that of last year, which is still striking because contracts for works and services were abolished in the labor reform, with the idea that they would become permanent discontinuous contracts. A ‘grace period’ of three months was even granted to facilitate this transfer .

But this has not happened. In the first seven months, 71,914 conversions were made from temporary to discontinuous fixed. A figure that represents less than a third of the total contracts for work and services made indefinite.

Most are first extensions
As regards the extensions that are signed, seven out of ten are made for periods of less than three months , a level similar to that before the labor reform.

In addition, in 96% of cases it is the first extension of that contract. This percentage, however, is also equivalent to that of a year ago.

In this sense, the data on extensions reinforce the hypothesis that the reform has not improved the quality of the temporary contracts that continue to be made, which continue to be exposed to high turnover rates .

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