Record growth of self-employed in Malaga with 54% of the new ones being foreigners, but is it a good or bad thing?

No other Spanish province, not even Madrid or Barcelona, has experienced the growth in self-employment that Malaga has experienced in the last five years. The register for the country's self-employed workers, known as RETA (Regimen Especial de Trabajadores Autónomos), has added nearly 18,000 members in the province over this period, now in excess of 138,000. In percentage terms this increase is equivalent to almost 15%: a rate over four times higher than the Spanish average (which was 3.4%). In the last year over 5,000 contributors have signed up to RETA.

Is this good news or bad news? This question may come as a surprise, as we are used to the increase in self-employment being celebrated by public officials as an achievement associated with great entrepreneurship and wealth creation. However, the reality of self-employment is harsh. Recently, the report 'Diagnosis of in-work poverty in Spain', produced by the Iseak Foundation (data analysts in economic and social research based in Bilbao), pointed out that in-work poverty falls heavily on the self-employed. "Among those in salaried employment, in-work poverty reaches 1 in 10; however, this rate is notably higher for the self-employed, with 27% not exceeding the poverty risk threshold," stated the study. The ATA national federation of self-employed workers' associations itself has pointed out that the declared net income of most of those affiliated to the RETA "does not reach 20,000 euros."

The record growth of self-employed workers in Malaga is due to different profiles and reasons. The most obvious is the outstanding economic and employment growth that the province has been experiencing since the end of the pandemic. "Tourism and the hotel and restaurant industry, construction, real estate and the technology sector are very strong in Malaga and generate opportunities for self-employed businesses," says José Luis Perea, secretary general of ATA, who points to a second factor: the existence of a favourable environment for growth. He highlights the zero quota introduced by the regional government for the first year of activity, which "eliminates the entry barrier."

Pepe Galván, president of UATAE Andalucía (a trade union for the self-employed in Spain), shares the hypothesis that the growth of the Spanish economy, the regional economy and especially that of Malaga province is the main reason for the increase in the number of self-employed workers. "All the large companies that set up in the province generate around them an ecosystem of auxiliary services, 90% of which are self-employed."

Interestingly, the business sector that has most generated 'autónomo' numbers in recent years in Malaga is not one of those considered to be the most traditional for self-employment: neither retail nor the hospitality industry. It is the professional, scientific and technical activities that have added the most self-employed workers: almost 3,600 in five years or 26%. This sector includes everything from lawyers to architects, publicists, veterinary surgeons and designers.

In second place in the ranking is a sector that has been around for a long time: construction, with 3,400 more self-employed workers than five years ago. "It is a sector with a lot of growth throughout the Costa del Sol and there is a preference on the part of the construction companies to hire companies rather than salaried workers for specialised tasks, such as electricity," says Pepe Galván.

The third sector that has added the most self-employed is transport. Now this is where there may be a component of false self-employment. "Motorcycle riders and delivery drivers are examples of the labour exploitation that is hidden in some cases behind self-employment", says the provincial secretary of the CC OO trade union, Fernando Cubillo. The food delivery company Glovo has been making headlines for the last two weeks due to the trial against its founder for disobeying multiple court sentences that condemned him for not putting his delivery drivers on the payroll. Similarly, years ago Amazon had to give up its delivery system based on "independent collaborators" because they were considered to be falsely classed as 'self-employed'. However, this is not the only sector affected by this phenomenon: from the meat industry to the private health sector and the media, there are bogus freelancers in many areas.

If there is one group of self-employed workers that has been particularly hard hit then it is the agricultural sector, according to the president of UATAE Andalucía: "They are owners of small greenhouses and farms that depend a lot on who buys their produce and on the weather. They are in dire straits."

Although it is not in the top three of activities with the highest number of self-employed in absolute terms, it is worth analysing the increase in the number of self-employed professionals in tech work. In five years this group has increased by more than 60% in the province. Braulio Díez is a veteran self-employed professional in this sector, in his case with a company and employees under his responsibility: "I would distinguish between two profiles: those who are self-employed of their own free will, like me - despite the fact that this country is a nightmare to be self-employed - and those who are self-employed out of necessity. In this sector there are people who train and, in order to gain experience, start by offering themselves as self-employed professionals. But as soon as they can, they take a job as an employee," he says.

Despite the strong growth in self-employment, Malaga is not - at least not yet - one of the provinces with the greatest proportion of self-employment compared to the total number of employed. In Malaga 20% of active workers are self-employed, a percentage that is above the national average (16.7%), but below provinces such as Zamora, Lugo or Ávila, which exceed 25%. In Andalucía the provinces of Jaen, Cordoba and Almeria are above Malaga in relative proportion of self-employment.