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Labour market reform, Spain, unemployment

Abandoned in austerity Spain: no job, no benefits

Read the news and it’s all upbeat about Spain.

The Spanish economy grew  0.6 percent in the second quarter, the fastest rate since 2007, before the country slipped into recession. That’s the fourth consecutive quarter of growth.

And Spain’s unemployment rate has fallen to a two-year low – of 24.5% in the second quarter.

Of course at a quarter of the working population, unemployment remains very high, second highest in Europe in fact. And more than half of all young people (15-24 year olds) have no employment.

But the trend is positive, the Popular Party government of Mariano Rajoy argues: austerity is working.

But other, recently issued figures show a different picture.

Of the 4.42 million registered jobless only 2.46 million get any welfare benefit, meaning a huge number (well 59%) of Spaniards are not only unemployed but left without a euro cent.

And that’s not the whole story. More and more people who do receive unemployment benefits are receiving subsistence level payments, some as low as 450 euros a month – 1.45 million compared to 1.1 million on the higher ‘contributory’ rate.

Of the 1.45 million, the majority are women, who predominate in temporary, poorly protected and low paid employment, what the Spanish call ’empleo basura’ (crap jobs).

Migrant workers hardest hit

But the hardest hit are migrant workers – the people who made such a contribution when Spain was booming.

Many have now returned to their countries of origin to find work.

But for those who remain, just over half a million are now unemployed. Yet just 234,000 get dole money. (just 153 million of the 1.9 billion euro welfare budget for the unemployed is spent on foreigners).

The numbers not receiving unemployment benefit or receiving only the bare minimum reflects largely how long people have been unemployed (62% are now long term unemployed) , as benefit is progressively cut the longer you have been out of work. It also reflects the huge size of the precarious workforce not tied into the social security system.

Jobless rate falling, so too quality of jobs

Indeed the real story behind the latest unemployment figures – so trumpeted by Rajoy’s administration – is a permanent workforce is being replaced by a precariat. Temporary and involuntary part-time contracts are booming, not because people want them but because that’s all there is.

Twenty four percent of workers are now in temporary jobs, with 17.7% in involuntary part-time work, rising to 27% among women. Underemployment is now running at 61%, as measured by those working part-time when actually they want full time work, points out the Comisiones Obreras trade union.

In Spain, there remain just under three quarters of a million households without any form of income – wages, pensions or other welfare payments included. There are 1.8 million homes were everyone of working age is unemployed.

Added to this picture of misery, is the dramatic effect of wage cuts, that are not only grossly unfair in a country where the wealthiest have got richer during the crisis, but are nudging the country to the brink of deflation.

Alternative

Unions want a new approach:

  • extending the welfare safety net to cover all those without an income
  • quality, targeted training to help the unemployed get back into the jobs market
  • a reversal of the ‘reforms’ that have deregulated the labour market
  • substantial pay rises to reverse the collapse in living standards and boost domestic demand
  • above all an end to cuts, driven by mad deficit reduction plans, tied to EU budgetary commitments, that are strangling the economy.

So you might get the impression from the media reporting on Spain that austerity is working. Millions of Spaniards would beg to differ. And, as the recent European election results and subsequent polls show, want something completely different.

About revoltingeurope

Writer on Europe's Left, trade union and social movements @tomgilltweets or @revoltingeurope

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