Youth unemployment: More jobs for young Spaniards

Spain has the second highest youth unemployment rate in the EU. But the rate fell by more than ten percentage points within a year. A labor market reform should now make it easier for young people to stand on their own two feet.

February 3 was a historic day in the Spanish parliament: Prime Minister Pedro Sánchez’s government pushed its labor market reform through parliament with a majority of one vote – a backbencher in the conservative opposition had accidentally voted wrongly, i.e. for the government’s prestige project. With this reform, she is pursuing a major goal: to put an end to insecurity, as Labor Minister Yolanda Díaz has repeatedly said in recent months.

Stricter rules and a dual system

Insecurity that particularly affects many young Spaniards. The reform contains new rules for fixed-term employment and severely restricts them. It strengthens forms of dual training that are familiar from Germany. And it makes it harder to circumvent collective agreements, for example by outsourcing jobs to subcontractors. Everything is going in the right direction, says Juan Enrique Gallo Gonzalez from the Spanish Youth Council, but Spain is still a long way from a real solution.

“Currently, a third of the young population in Spain is unemployed and half of those who have jobs have fixed-term contracts lasting less than a year,” Gallo Gonzales said. “It affects their life planning, that they can’t really be independent because they don’t have the economic means to do so.”

Temporary contracts prevent independence

In concrete terms, this means that almost two thirds of 25 to 29 year olds in Spain still live with their parents. It was the same for Maria Moreno when she was almost 30: “I want to live with my partner and be able to be independent. But with the contracts we get, that’s impossible.”

Moreno had 25 contracts in three years, always limited. She trained as a secretary, worked as a hostess at trade fairs, worked as a nurse’s assistant in a hospital – always for little money: According to the youth council, the average salary in 2021 was just 960 euros. “The conditions in this hospital: These are part-time contracts, sometimes you work two days, then you don’t work for two days. You can’t plan anything or lead a life like that,” Moreno complains.

All of that is set to change with the labor market reform, the effects of which the government believes it can already see. A record number of almost 240,000 permanent contracts were signed in January, said Labor Minister Diaz.

Visible effects probably only in summer

However, this was offset by almost 1.4 million fixed-term contracts that were concluded in the same period. A transitional arrangement for companies was in effect until the end of March. Youth council representative Gallo Gonzalez believes that it is still too early to be able to make a serious assessment of whether the labor market reform is working or not, also with regard to the development of youth unemployment.

“The temporary or seasonal contracts, especially for the summer, only start now,” he points out. “I would say that maybe October is a good time to see if these developments are not simply part of the recovery from the crisis or if they are really related to labor market reform.”

The economic consequences of the corona pandemic have hit Spain’s young generation particularly hard: 53 percent of Spaniards under the age of 35 lost their jobs at the beginning of the pandemic.