A new study by the consultancy firm Foqus has said that nearly one million jobs will be wiped out from the hospitality sector as a consequence of the Covid-19 pandemic which has pushed Spain into lockdown.
Since mid-March bars, restaurants, hotels, and many other businesses which offer hospitality to travellers and tourists, have been told not to trade as Spain tackles the Coronavirus.
The research which was undertaken in collaboration with Valencia University estimates that between 900,000 and 1.1 million direct and indirect jobs may be lost as revenue generated by the sector drops between 45% and just under 56%.
Most of Spain is now in phase 1 of the four-phase de-escalation plan. The exception to this includes the cities of Madrid and Barcelona which are still showing a higher number of cases and deaths than the rest of Spain.
However, those bars and restaurants in phase 1 are still very restricted in the number of customers who may visit their establishments at one time. Furthemore, outside terraces may be used by customers but not the inside of premises. In addition, those businesses which open must pay the social security and income taxes for all of their employees and not just those who are working. All in all, the restrictions mean that doing business is just not viable for many.
In the best case scenario, international tourism will be at full capacity again by October. In the worst case scenario, restrictions will continue to be imposed on travel and tourism. In this case annual earnings will drop by a little more than half from €120 billion to around €55 billion and around 1.1 million jobs could be lost.
The hardest hit areas are expected to be Andalucia, the Canary Islands, and Madrid.