It’s been a torrid 12 months for Spain. The country is convulsed by crises on several fronts and it is hard to see where a resolution will come from. Not only is the fallout from the illegal Catalan declaration of independence proving problematic – the new president, Quim Torra, is arguably more hard-line than the last – but a corruption scandal is threatening to topple the ruling party.
But this only provides so much distraction from a more troubling story: that of the economy. Improved overall growth figures cannot conceal the ongoing rise in precarious and poorly paid work which increasingly characterises the Spanish economy.
Rents in Spain have been rising 12 times faster than salaries; the typical salary of young workers entering the labour market is 33% lower today than it was in 2008; and about 90% of new employment contracts signed in 2015 were for temporary positions. Unemployment peaked at 27% in 2013 and has since fallen, but it remains twice that of the Eurozone average. And the country also holds the unenviable distinction of having the third highest rate of child poverty in the EU (after Romania and Greece).
But these broad-brush statistics don’t tell the full story. Others have done pretty well out of Spain’s descent into recession a decade ago: the wealthiest 1% saw its share of national wealth increase from 17% in 2011 to 20% in 2014, according to the Bank of Spain. Indeed, it is the poorest 25% who have suffered the biggest loss of wealth since 2011, with the bottom quarter in debt by an average of €1,300.
It’s a disparity that can be seen starkly in the contrast between the undeveloped south, areas such as Andalusia and Murcia, and cities such as Madrid and Barcelona. The average salary in the Madrid suburb of Pozuelo de Alarcón is €73,000, while in Torrevieja, a province of Alicante, it is just €13,000. A summer holiday resort that attracts its fair share of British pensioners in search of sea, sun and sangria, Torrevieja experiences challenges similar to towns like Blackpool, with many of the local jobs vanishing during the winter months. The nearby city of Elda, another tourist destination, was listed as having the highest number of residents out of work in the whole of Spain in 2015, with an astonishing 40% of residents without a job.
The south east, you could call it flyover Spain, was particularly badly hit by the decline of construction. And white elephants – all those abandoned building projects – dot the landscape after toxic debt burst the building bubble and brought down the country’s banks.1
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