Spanish regions top European Union unemployment tables

Seven of the ten EU regions with the highest unemployment are Spanish, including the top four.

Get all the data used in this article here.

More fantastic economic news: seven of the ten EU regions with highest unemployment during 2013 were in Spain, including all of the top four, according to data from Eurostat.

Such depressing figures clearly show the depth of the employment problem facing Spain, and that any talk of a recovery means little to the millions of people still looking for work. The numbers make for pretty glum reading all around, including youth unemployment.

What’s more, the cost of labour in Spain hasn’t decreased, meaning it isn’t any cheaper to employ people or to export Spanish goods.

Here is a breakdown of the ten EU regions with the highest unemployment:

Of the ten regions with the lowest unemployment, not one is in Spain, and all are in northern Europe or Scandinavia.

Spain features only slightly less strongly in the 15-24 bracket, with youth unemployment continuing to be a huge issue:

 

Spain and Greece provide the bulk of the regions affected by high unemployment, which is unsurprising. France features but only through its overseas territories, Montenique and Reunion Island.  

Germany, Sweden, Austria and Finland feature frequently in the best-performing tables.

When it comes to long-term unemployment the figures Spain does not feature in the top 10. This is not always a good sign however, as it can mean that people have simply given up looking for work or have moved overseas looking for work as many young Spaniards are doing.

Spain’s unemployment in Context

Compared to the EU as a whole, Spain is lagging well below the employment average. While 10.8% of Europe’s active workforce is unemployed, the figure is a whopping 26.4% for Spain.

 Here is a simple map showing how different comunidades contribute to Spain’s total. Click on the the community you want more information for.

 

While Spain’s Gross Domestic Product (GDP) has shown modest growth it is nowhere near enough to stimulate relief in the labour market. It is generally held that sustainable annual growth of 2% is required for an economy to be creating jobs.

Spain’s problem is often viewed as a lack of competitiveness. Spanish labour costs increased when it joined the Euro and when the crisis hit the shared currency meant it was impossible to make the Euro weaker.

Weakening a currency is a good trick in times of crisis: it means that more of your goods and services will be exported even if the buying power of the currency is weakened. With a shared currency this is not an option, so instead making the products and providing the services must be made cheaper, and according to some that means cutting labour costs.

Politicians call this labour market flexibility. It means making it easy to hire and fire people through looser contracts.

Making people work for less or cutting jobs is only one approach which is roundly rejected in some quarters. Paul Krugman, who has his blog translated in this paper, is a Nobel Prize-winning economist and columnist for the New York Times.

Krugman posted about Spain’ devaluation back in 2012, and also wrote a “wonkish”, complicated post which you can read here, in which he explains the alternative: some bond-buying by the ECB and therefore inflation in the rich countries steadying the ship.

If it’s more expensive to buy olive oil in Germany, then the price a German would pay a Spaniard to import it would be relatively less.

Yup, that scenario won’t happen.

However as data from Eurostat showed last month Spain hasn’t yet managed to cut hourly labour costs anyway, which are higher now than they were in 2008:

As the graoph shows, Greece and Portugal have made cuts in their costs per hour in an attempt to improve competitiveness. In comparison, Spain's costs have remained stable and, despite falling from a 2011 peak, have begun to rise again. 

Instead, despite enforced flexibility in the public sector, there are fewer people working, more pain and no end in sight.

 

Comments

[Publicado por: Salas]

Fueron datos muy tristes!