Spain’s Lost Generation: What Do You Do When Half Your Country’s Youth is Unemployed?Reported by The New Republic on Wednesday, 30 May 2012 (on May 30, 2012)
“They say we’re a lost generation. But it’s more like we’re a paralyzed generation,” Mario tells me over a beer on a sweltering Monday afternoon in Toledo. He is a twenty-five year-old Spaniard, and already his future prospects look unsalvageable. He holds a degree in visual communications, but irregular work and a negligible income has forced him to move back in with his parents. At the moment, he scrapes by working as a temp at regional post-offices, hoping each day that some employee might call in sick.
“I’m basically tied to my cell phone,” he starts to say. And for a fleeting second, as the words hang there in the sun-drenched Plaza Horno de Magdalena, he might be in New York, London or Berlin, lamenting some high-intensity job with around-the-clock demands. But his tone quickly veers back to desperation. “I need to take anything I can get,” he continues, “and so when they call me the morning of or the night before, I go; wherever it is.”
Mario is not alone in his desperation: Unemployment in Spain is 25 percent, and youth unemployment hovers at double that. Of all the jobs lost to the country’s protracted recession, about half have come from the construction sector alone. Spain’s Castille-La Mancha—Toledo is its capital—is especially hard hit. The construction industry flourished in this desert-streaked region during the boom years. But union workers tell me that the chief industry was the manufacture of doors. It is a prosaic fact with a tragically literary flourish: Once a portal to other places and ascendant prospects, Castille-La Mancha is now a hull of its former self.
Like so many others throughout Spain, Mario’s voice has that brittle, dry quality of an old confidence that’s begun to splinter. He tells me that he’s “not particularly hopeful” about what’s in store. To his left sits Raquel—another Toledo native, the same age as Mario, and a self-professed optimist. She cuts in: “I have two degrees, but I may as well not have studied anything at all.” When I ask her about her next move, she says that she’s thinking of leaving the country. She mentions a secondary school in Italy where she could teach humanities. Flushing slightly, she quickly adds that job prospects there are only marginally better than in Spain.
Raquel had hit on a familiar pattern among young Spaniards as they agonize over what to do while the economy worsens. An idea flickers with possibility then promptly darkens under a swarm of caveats. To speak with young Spaniards is to listen to the expectations of an entire generation buckling under the weight of a hopelessly constrained economic reality, and trembling at the thought that no one is listening.
THE HIGHLY ARTICULATE, university-educated indignados who have taken to the streets in the big-metropolitan hubs (or who confidently sound off before foreign journalists, for that matter) are only one part of the story of Spain’s lost generation. The other has to do with those who are not as likely to be heard—mostly because they’re not convinced that talking will get them anywhere.
In the words of public policy consultant Jorge Galindo, this other subclass of unemployed remains more or less “invisible.” These people left school in their late teens to claim inflated salaries working construction. They are visibly less self-possessed than their educated counterparts, who are buoyed somewhat by the aplomb conferred by a college education and membership in the middle class. The middle-class, university-educated parados (jobless) tend to do two things, according to Galindo. Either they go back to school to get a masters degree and beef up their CV’s while waiting out the crisis. Or they leave for places like Germany or England. Those who do that, Galindo says, are “only those who can afford it.”
It is even worse for wage laborers who dropped out of school; they are truly stuck. In regions like Castille-La Mancha, drop out rates were especially high, as construction salaries beckoned. Out of work, these people are hanging by the thread of dwindling unemployment checks.
Jesus, a 33 year-old parado, is one such person. We met in Toledo. At seventeen, he embarked on a series of jobs that ranged from agricultural labor to metallurgy and two stints in construction. Only once did he have a fully serviceable contract—known here as a contrato indefinido—that furnished benefits and afforded some measure of job-security. The company folded, though, and soon he was back to temporary contracts.
“There are two ways you get paid under those contracts,” he explained, “in ‘A’ and in ‘B.’” “A” means being paid on the books; “B” off-them, or en negro. Employers routinely paid construction workers large amounts of cash under the table and only nominal “official” salaries. Not only could they avoid paying additional taxes this way; also, it enabled them to pay out less in benefits to the workers they’d eventually let go, since those benefits are tied, in part, to the size of workers’ salaries. As Jesus told me, “I ended up getting significantly less benefits than were due me.”
The peculiarities of the Spanish labor market are at the very crux of the youth unemployment problem, says economist Carlos Sebastián, a professor of economic analysis at Madrid’s Complutense University. Indeed, it is impossible to understand the generational rift at the heart of contemporary Spain without examining the traditional strength of Spain’s unions, and the raft of perverse incentives that it encouraged, for employees and employers alike.
In the late 1970s, in the heady early days of Spanish democracy, the country’s parties made a concerted effort to show their affinity with the working classes; in practice, this meant accommodating unwieldy union demands. When a recession hit in the 1980s, one of the few ways the government could combat unemployment without cutting into existing labor prerogatives was to create “temporary contracts.” These were designed to make it easier for businesses to hire young people (as well as immigrants). But since it paid out fewer benefits, it also made it cheaper for businesses to shed these workers when the going got tough.
The recipients of these temporary contracts—ie: the occupants of the Spanish labor market’s lower rung—have always been the country’s youth. There is thus a steep drop-off in how Spain’s older and younger generations have been trained to think of their economic prospects. In talking to Spaniards in their twenties and thirties, it is routine to meet people, regardless of their background, who describe being hired for a year or two, then fired, and rehired several months later. It’s also rare to find anyone in her twenties or thirties who has had, or knows someone who has worked under, anything other than temporary contracts.
It’s impossible to deny that Spain’s unemployment crisis partly has to do with the way the country’s youth has been forced into this system of temporary contracts, without being offered any plausible hope of escaping into more promising work. Even now, in the midst of an economic freefall, it is the fate of Spain’s long-privileged unions that have received the majority of attention of the media and politicians. The issue of temporary contracts, then, is another problem that has largely remained “invisible.” Indeed, it is precisely because the problem of youth unemployment is so big that it is impossible to see clearly.
JESUS SAYS HE regrets dropping out of school. But in the new age of austerity, options to make up for his past decisions are severely limited: Public educational programs for adults over twenty-five years old are being slashed as part of massive spending cuts in education. The few courses that remain are oversubscribed, and there are long waiting lists, Jesus says.
“Still,” he adds, “I’m lucky.” He doesn’t have a family he has to support right now, like many of his friends. Among his former work companions, those with children of their own have had to move back in with their parents. Increasingly, Spaniards well into their thirties, and in some cases early forties, are returning home. A budding trend is for grandchildren to move in with their grandparents. There, they jointly live off their grandparents’ pensions, and care for them all the while. Grandchildren thus have an attenuated income stream, while families are spared the expense (literally and figuratively) of sending grandparents to nursing homes.
Such domestic arrangements have mitigated the pain of unemployment for Spain’s youth—but they are also contributing to the depths of the country’s economic malaise. Indeed, there are a number of demographic trends in Spain that help explain the peculiar intractability of the recession. For example, Spaniards tend to stay in their home regions, and cluster around where they grew up: thus, there is very little internal migration within Spain. As one young person told me: “I’d be more inclined to leave Spain than to move, say, from Castille-La Mancha to Catalonia or Basque country,” where unemployment rates are notably lower.
Some of this has to do with the central role played by the family. But it’s also because homeownership in Spain has always been extremely high. According to Eurostat figures, over 80 percent of the population were homeowners in 2010. “Property ownership [in Spain],” said Font, “signals social status, so second homes are even common among the middle class.” As for the lower-middle classes, “owning a house, as opposed to renting, marks ‘insider’ versus ‘outsider’ status,” Galindo told me. This fixation on home-ownership has unmistakably cultural roots; but it has had clear economic consequences, as young people come to think of their family’s property as the only dependable bulwark in tough times.
One thing is clear: the government has thus far not suggested any ways to soften the impact of these deep-seated cultural factors. The ardently budget-slashing conservative government of Prime Minister Mariano Rajoy is instead focused on trying to reform the labor market. It remains to be seen whether or not this will have positive effects down the line. But these are not the sorts of changes that can be felt in the short term, says decorated sociologist Victor Pérez-Díaz, President of Analistas Socio-Políticos, a Madrid-based consultancy. Unless the European Union consents to more stimulus spending in Spain, the ranks of the unemployed will continue to swell for the foreseeable future.
Perhaps the most hopeful thing that can be said of the lot of Spanish youth is that they are used to living under constrained circumstances. Back in the early 2000s, with the economy on the up and up, young people had already started taking to the streets to complain about their precarious lot. Businesses were capitalizing on easy credit at the time, but even then young people felt uncertain: dependent on temporary contracts, over-exposed, underpaid. They coined the phrase mileurista—someone who makes only a thousand Euros a month. Then it seemed barely enough to live on. When I ask Mario about this in Toledo, he laughs. “With a thousand Euros right now, I’d be living like a king.”
Jonathan Blitzer is a journalist living in Madrid.
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