By level of educational attainment, the fall in employment for workers with lower studies (-13.8%) was far higher than that observed among those with intermediate studies (-4.6%), while there was a year-on-year increase of 1.5% among employees with higher studies. 3 For further details, see the Banco de España Annual Report 2019, Box 4.2, “The employment income and financial situation of the workers most affected by COVID-19”. 6  sectors, these new restrictions could also bear down directly (and not only through knockon effects) on the degree of robustness of the other productive sectors. In these extraordinarily uncertain circumstances, a very significant deterioration is in any event expected in the Spanish economy’s levels of activity and employment, and in its public finances for 2020 as a whole. And this negative impact will, moreover, be relatively persistent. In particular, taking the above-mentioned Banco de España scenario 1, GDP would contract by 10.5% in 2020 (12.6% under scenario 2), and pre-crisis levels of activity would not be regained until late 2022, when the level of GDP would still be some 2 pp below that recorded at end-2019 (more than 6 pp below in scenario 2). And this despite the fact that output would grow with some momentum in 2021 and 2022, at rates of 7.3% and 1.9% under scenario 1, and of 4.1% and 3.3% under scenario 2. This adverse impact of the pandemic on Spanish GDP would generally be more marked than that which most developed countries would undergo.

I referred in detail to these structural reforms in my appearance before the Parliamentary Committee for the Economic and Social Reconstruction of Spain after COVID-19 last June.9 Allow me simply to recall here that low potential growth was already a problem in Spain before the crisis, characterised by low growth of factor productivity and a higher unemployment rate than in the other developed countries. Also, although it is still early to quantify its impact, this crisis will foreseeably further damage the economy’s potential 8  Also, the debt rule requires that the ratio between this variable and GDP be reduced annually by one-twentieth of the differential with respect to the reference value of 60%. Since the debt ratio could reach around 130% of GDP, this differential would amount to some 70 pp, so that, according to this European rule, it would have to be reduced by some 3.5 pp per year. 9  https://www.bde.es/bde/en/secciones/prensa/intervpub/Discursos_del_Go/comparecencia-del-gobernador-en-la-comision-para-lareconstruccion-social-y-economica--de-espana-tras-el-covid-19--del-congreso-de-los-diputados.html  29  output. The message is that structural reforms are now even more necessary; they are also needed to alleviate and accelerate fiscal consolidation. 3.3  The composition of public finances  The strategy to reduce budgetary imbalances should be detailed and credible, setting out the deadlines and objectives and the measures to achieve them. It should also be long-term growth-friendly, which requires a thorough review of the various revenue and expenditure items. In addition, it should ideally be an integral part of an overall strategy that also addresses the adoption of long-term growth-friendly structural reforms.