Algarve unemployment rate soared 200% in May

The falloff in tourism numbers in the Algarve caused unemployment to increase by over 200% in May according to the Institute of Employment and Professional Training (IEFP).

The institute calls the situation “worrying and complicated” but stresses that there are signs of a return with 85% of hotels reopening in June or this month.
According to the IEFP there were 28,000 unemployed in the Algarve in May as hotels, bars and restaurants suffered almost three months of losses.
And since the pandemic coincided with the start of contracting staff for the tourism season, thousands of people ended up not even being hired, while others were let go during the experimental phase.
In a normal summer, Tivoli Hotels & Resorts would have around 1,000 people working in six hotels in the Algarve and who are contracted by the hour, day or week — but currently only around a half are working, according to the Lusa News Agency which spoke to the group’s regional operations director Jorge Beldade.
“In March, when the pandemic started (for Portugal) we were in the initial phases of contracting 350 people for the season. In the end we only took on 89 and obviously the others weren’t hired. Then the hotels closed and staff went on layoff,” he said.
In the Algarve, 85% of hotels reopened in June or are reopening now (July), a number that nevertheless is optimistic taking into account the forecasts for the sector at the start of the pandemic which initially did not expect so many hotels to reopen this year.
The Algarve Hotel and Tourism Establishments Association (AHETA) stated that after the low season, when the sector was preparing for the tourism season, the region was hampered by the prospect of a summer season that “could not be comparable” to last year, which in practice meant three consecutive low seasons.
“The effect on companies’ revenues and the impact on employment is undeniable” says AHETA President Elidérico Viegas who estimates that from September “the numbers will get worse again.”
According to data from the IEFP, the Algarve was the most hard hit region in Portugal in terms of unemployment, with a growth of 202.4% on the same period last year.
“It is a complicated situation, with a fairly high level of unemployment which worries us. In February, no one would have believed that this would have happened because our economy was growing and unemployment had been falling,” says Madalena Feu of the Algarve IEFP.