Digital service companies in Spain are experiencing solid revenue growth, with a year-on-year increase of 11% as of August, according to the TIC Monitor barometer, developed by the VASS Foundation and the Center for Economic Predictions (CEPREDE). However, job creation in the sector is showing signs of slowing down, recording the lowest level since March 2021.
Revenue Growth and Job Moderation
The digital sector’s revenue has managed to recover after the slowdown alert issued in June, maintaining an average growth of 10% in the first eight months of 2024. However, after adjusting for price effects, the real growth stands at 6.7%. These figures reflect the sector’s resilience in the face of an uncertain economic landscape characterized by inflation and geopolitical instability.
In terms of employment, although the number of affiliates continues to rise, with nearly 3,000 new hires in September, the year-on-year growth rate has decreased to 2.7%, the lowest level in three years. Currently, the sector employs 484,809 people, with an increase of 26,267 jobs over the past twelve months. The average hiring rate for 2024 has settled at 3.8%, two points below the 5.8% recorded in 2023.
An Environment of Caution and Operational Efficiency
Factors such as high interest rates and the geopolitical context have led many digital service companies to prioritize efficiency over workforce expansion. Furthermore, the rapid evolution of artificial intelligence has pushed organizations to reconsider their investments and strategies, seeking to optimize their operations and resources. According to the TIC Monitor, the overall climate of caution has led digital sector companies to focus on the sustainable growth of their activities rather than on aggressive personnel expansion.
The employment climate indicator, which captures the opinions of business leaders in the sector, reflects this cautious trend. While in previous months the indicator reached +26.2 points, it now stands at +2.0, below the European Union average (+11.7). This balance reflects a greater emphasis on maintaining current labor structures rather than significantly increasing them.
Moderate Growth Prospects Until Year-End
Despite this slowdown in hiring, business sentiment in the digital sector remains positive. The TIC Monitor barometer indicates that 66.4% of companies expect an increase in revenue by December, with a business climate indicator of +32.8 points, surpassing the EU average (+22.2). This optimism suggests that the digital sector will continue to drive the economy, albeit with a more measured growth strategy in terms of labor.
Antonio Rueda, director of the VASS Foundation and head of the TIC Monitor, commented: “Companies continue to grow in activity, but they seem to have shifted their focus to enhancing their operations until the end of the year. Job creation will be more measured, but this trend is allowing for a 5.7% increase in the revenue per employee ratio over the past twelve months. The sector aims to exceed 500,000 affiliates by 2025.”
AI and the Need for Adaptation in the Digital Sector
The incorporation of artificial intelligence is redefining the landscape in the digital sector, prompting companies to rethink their investments. This focus on optimization and the use of advanced technologies, rather than massive hiring, could influence the types of profiles companies will seek in the near future, favoring those specialized in AI and emerging technologies.
Although the sector shows a more reserved approach in terms of employment, demand for talent in advanced technological areas is expected to remain strong as companies integrate AI and other cutting-edge technologies into their operations.
A Promising Future with Efficiency and Technology as Core Elements
As digital service companies continue to grow and adapt to new technological realities, the sector remains a pillar in the Spanish economy, ranking fifth in job generation. The current focus on operational efficiency and sustainable growth appears to be creating a solid foundation that will allow the digital sector to remain a key player in the Spanish labor market.
In conclusion, although job creation in the digital sector is slowing down, strong revenue and growth potential through AI adoption and resource optimization are indications that the sector maintains a strategic role in the economy and is heading towards a solid technological and labor foundation in 2025.