Why 1 Million New Jobs in Spain May Be Bad News

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from Bloomberg Businessweek,

Spanish companies are hiring, but nearly all the jobs are temporary and poorly paid. That’s likely to depress productivity and discourage new employers who could offer stable, better-paid jobs.

Spain created about 500,000 jobs last year, more than any euro zone country except Germany. With the economy forecast to grow a healthy 2.9 percent in 2015, Prime Minister Mariano Rajoy predicts another 500,000 jobs will be created by year’s end—evidence, his government says, that Spain is benefiting from reforms enacted in 2012 to make its labor market more flexible and competitive.

But the bad news for workers is that nearly all these new jobs are short-term, low-paid, and dead-end—what the Spanish call trabajo basura, or garbage work. Government data show that 92 percent of the positions being created are temporary, with some lasting only a few days. One-fourth of labor contracts signed during the first three months of 2015 were for one week or less. Spanish temps make an average 12,000 euros ($13,300) annually, about half what’s earned by people with long-term contracts.

Madrid electrician Alberto Naveiras, 36, and his girlfriend, Ester Mansilla, a 31-year-old cook, have bounced from one trabajo basura to another, interspersed with stretches of unemployment, since being laid off from long-term jobs in 2012. In mid-June, Mansilla landed her tenth temporary gig, helping a Madrid restaurant with its busy wedding season. Naveiras’s latest contract, supervising maintenance at an apartment complex for 16 hours a week, started a few days later. “You can have experience and good education, but it’s impossible to find fairly compensated full-time work,” Mansilla said. Employers take advantage of temps by hiring, firing, and rehiring them on new short-term contracts, she added.

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