Measuring Labour Market Dynamics: An Application To Spain (original) (raw)

The labor market in Spain, 2002–2016

IZA World of Labor, 2017

Despite the ongoing recovery, the Spanish labor market is still far from doing well. Youth unemployment as well as both temporary and long-term unemployment remain significant problems. Issues also exist with respect to immigrant workers and wage inequality, particularly for lower-wage workers. On the positive side, the labor force participation gender gap has shrunk considerably. Policymakers could combat the long-term unemployment challenge by putting more efforts into the design, implementation, and evaluation of well-targeted active labor market policies. Unemployment rate and real monthly wages ELEVATOR PITCH Spain, the fourth largest eurozone economy, was hit particularly hard by the Great Recession, which made its chronic labor market problems more evident. Youth and long-term unemployment escalated during the crisis and, despite the ongoing recovery, in 2016 were still at unsustainably high levels. The aggregate rate of temporary employment declined during the recession, but grew among youth. Most interesting have been the narrowing of the gender gap in labor force participation, the decline in the share of immigrants in employment and the labor force, and the overall increase in wage inequality.

The labor market in Spain, 2002–2018

IZA World of Labor

Despite the ongoing recovery, the Spanish labor market is still far from doing well. Youth unemployment as well as both temporary and long-term unemployment remain significant problems. Issues also exist with respect to immigrant workers and wage inequality, particularly for lower-wage workers. On the positive side, the labor force participation gender gap has shrunk considerably. Policymakers could combat the long-term unemployment challenge by putting more efforts into the design, implementation, and evaluation of well-targeted active labor market policies. ELEVATOR PITCH Spain, the fourth largest eurozone economy, was hit particularly hard by the Great Recession, which made its chronic labor market problems more evident. Youth and long-term unemployment escalated during the crisis and, despite the ongoing recovery, in 2018 were still at very high levels. The aggregate rate of temporary employment declined during the recession, but grew among youth. Most interesting have been the narrowing of the gender gap in labor force participation, the decline in the share of immigrants in employment and the labor force, and the overall increase in wage inequality. KEY FINDINGS Cons Youth and long-term unemployment skyrocketed during the Great Recession; in 2018 they were still both very high and very far from their pre-crisis levels. Male labor force participation fell because of the drastic reduction in young men's participation in the aftermath of the crisis. The rate of temporary employment escalated significantly among youth. Immigrants were hit particularly hard by the Great Recession. Real wages declined during the recession and have not returned yet to their pre-recession levels; this decline was especially pronounced for low-wage workers. Pros Employment has grown at an average annual rate of 2.4% since 2014. The gender gaps in labor force participation and temporary employment were smaller in 2018 than before the recession. The overall rate of temporary employment decreased in the wake of the Great Recession. The share of immigrant employment started growing again after 2014, albeit slowly. Both overall monthly wage inequality and inequality in the lower half of the monthly wage distribution started decreasing slowly in 2013.

Executive summary The Labour Market in Spain: Problems, Challenges and Future Trends 2

Despite a need for measures to ameliorate the impact of the labour market crisis, Spain is among the EU countries to have introduced the least number of improvements in recent years. On top of that, the severe structural reforms implemented have considerably worsened labour market access in the country, particularly for the most vulnerable groups, such as young people. The lack of accompanying measures to soften the effects of economic adjustment has worsened the position among the workforce and the unemployed alike. The immediate effect has been to accentuate Spain's economy was hit particularly hard by the financial crisis. After severe austerity measures have been implemented in recent years to contain a strong public debt increase, first signs of economic recovery are emerging. However, as SIM Europe results show, very few measures to soften the social consequences have been enacted. Spain scores second to last in the 'Labour Market Access' dimension of the Social Ju...

Wage dynamics in Spain: evidence from individual data (1994-2001)

Investigaciones Regionales - Journal of Regional Research, 2012

In this paper, we test the hypothesis of a wage curve against a Phillips curve for Spain, within a dynamic framework that allows for both of these, and for more general alternatives. To this end, we use data from the European Community Household Panel, providing micro-information for the period 1994-2001. The results indicate that, contrary to the situation in other European countries, the wage adjustment occurs in just one period, with the elasticity of wages to unemployment being close to the «empirical law of economics» of –0.1.

Evidence from a Labor Market Reform in Spain

2009

This paper evaluates the effects on employment, job turnover and productivity of a la-bor market reform in Spain that eliminated dismissal costs for fixed-term or temporary contracts. Our empirical results are based on a panel of 2356 Spanish manufacturing firms for the period 1982-1993. We postulate and estimate a dynamic labor demand model with indefinite and fixed-term labor contracts, and a general structure of labor adjustment costs. Experiments using the estimated model show important positive ef-fects of the reform on total employment (i.e., a 3.5 % increase) and job turnover. There is a strong substitution of permanent by temporary workers (i.e., a 10 % decline in permanent employment). The effects on labor productivity and the value of a firm are very small. These effects contrast with the ones of a counterfactual reform consisting in halving firing costs of all type of contracts. That policy implies the same increase in total employment, but much larger improvements in pro...

Labour Market Policy in Spain: Analysis of microdata and main results

Labour Market Policy Seminar, 2007

In this paper we use non-experimental microdata to analyse the effects of the main labour market policies (LMPs) carried out by the National Employment Institute (NEI) and the Regional Governments in Spain during the period 2001-2003. With this aim we analyse the relationship between participation in the programme and the probability of employment for those who have participated in LMPs, using a strict control group of non-participants with similar observable characteristics. Our results differ depending on the programme and on the group of benefi ciaries. In fact, participation in the programme produced especially positive results for the long-term unemployed, even when regions are analysed separately. These results indicate the need to improve the design and management tasks undertaken by the Public Employment Services. We feel that it would be useful to understand the characteristics of unemployed people more fully before they take part in the programme and to offer these individuals specifi c measures adapted to them. A practical proposal to be taken into consideration in any LMP evaluation exercise across the EU involves making more widespread use of the statistical information (microdata) available in employment offi ces or in social security records.

The wage dynamics in Spain: evidence from individual data

2011

In this paper we test the hypothesis of a wage curve against a Phillips curve for Spain within a framework which allos for these both and more general alternatives. To this end, we use data from the European Community Household Panel, which provides micro-information for the period 1994-2001. The results indicate that a partial wage adjustment is at work, as