Bleeding jobs in Spain appears to have no end, and is becoming increasingly clear that the government must introduce reforms in labor market regulation to stem the decline.
Whenever we talk about reform the labor market, the right proposed to lower the dismissal. The idea is that this business will be less afraid to hire because it is easier to dismiss. It is a mantra that is normal because it was arising which Aznar implemented in 90. However, I believe that this time they are wrong, for several reasons.
First of all, because, unlike what happened when similar measures were applied in 90, Spain today has a very flexible labor market, more than most European countries (including France, Holland, Germany and the Nordic countries), which, however, have lost fewer jobs, especially if one notes that have been dropped over in GDP. Spain offers many types of temporary contracts that allow companies to hire without any risk. The problem of unemployment in Spain is not the lack of flexibility but, on the one hand, very serious structural problems (ie complete dependence on a single sector is falling further into a tailspin), and secondly, a complete distrust of consumers who fearful of losing their jobs and the uncertain duration of the crisis, decide to save instead of consuming despite the falling prices (the rate of household savings has increased despite the increase in unemployment). If consumers are not spending, lower demand, increased unemployment, and thus distrust thus closing the circle.
Second, the lowering of dismissal creates distrust among consumers, even though it would not affect them directly. Psychology plays a more important factor than it appears in this crisis. When the other day I went to see my grandmother saved me about that because we were in crisis. She has not lowered wages, in fact, falling prices can now spend more, but nevertheless, the mere fact that there is talk of crisis and unemployment l sowing distrust it. Implement measures to facilitate the dismissal of some employees, would they all be more wary of eating, further reducing demand and thus increasing unemployment.
Rather than facilitating
dismissal, you have to do is attack the unemployment problem by directly stimulating the recruitment side on the side of employers, and other job search on the side of workers.
On the side of employers, recruitment should be cheaper, for which the state could take on account of the general budget, the social security contributions by the employer during the first 2 or 3 years (mainly during the crisis) for new contracts. This measure would be cheaper than paying the unemployed worker, and would be an incentive for new business recruitment. This measure could be combined with others such as proposals and credit lines for businesses that create new employment.
also on the side of the companies the government should grant the request of the ETT and enable them to manage not only temporary but also permanent contracts. This degree of flexibility does not worsen the temporary employment and live as the ETTs to manage contracts, creates an incentive for the creation of new jobs.
On the side of the workers have the problem that many of them are construction workers who have been contributing the last 8-10 years and therefore have enough time to strike guaranteed. If this is added the lack of demand in the construction sector, there little incentive to return to work, as it surely would have started a new job, and having no experience their pay would be low. Therefore the state should implement measures to make uncomfortable being unemployed and in turn generate wealth. Part of these measures already exist today, are refresher courses where the unemployed must learn a new trade / skill. What you need to do is force more aggressively to take such courses and pass if you do not want to lose unemployment benefits. On the other hand, I think a good measure to create incentives for job search is to force all the unemployed to do social work if they are not courses or interviews or risk losing their benefit. These works range from those who once performed the conscientious objectors to "volunteer" (mandatory volunteerism means ;-)) in NGOs or other service that best suits the person. When you have to get up to go to work, prefer to do a job you like, and better paid than in a forced and only receiving unemployment so the idea is that people do not suit to stay in bed until you run out of unemployment.
Finally, among the reforms that I believe necessary for the English labor market, there is a point where no one will cost you see the contradiction with much of what I have argued so far, and I think the state should reform official status to allow the dismissal. I am aware that this is create distrust in 12% of workers in Spain, but I believe that the benefits clearly outweigh the harm, and it is a privilege too damaging to the state and the economy.
When the law was written, it was intended that the inability (or insurmountable difficulties to be technically correct) to dismiss an officer avoid the captive vote, that is, the politician in office is put to their own and then the next the removed and therefore the officials always vote for the hand that feeds them. But there is more to hear the latest talks Fabra, or simply meet people in the administration to know that the charges finger and captive vote is the order of the day, then the law is not fulfilling its purpose.
other hand, the status of official state imposes such rigidity that creates absurd situations, as in the Valencia Polytechnic where he took early retirement at full pay that dozens of teachers with 40 to 50 years because fewer students. It is ridiculous that the state has to bear the full salary of a person 10-20 years simply because demand drops. It is necessary for the administration to adjust its workforce to the needs you have, both to grow if demand increases and to decrease if no longer needed.
Finally, is the system that creates incentives (especially in the English mentality), ensuring a steady income for life. I'm not talking the typical topic, as they can not dismiss is made or the egg, first because it depends on the person, and second because anyone who has worked in a private company have dealt with many cases of people who do nothing and manages to keep going. I'm talking about human capital loss in people highly qualified (PhD) who prefer to make an opposition to a high school teacher (or even high school) because at least have guaranteed employment. Or worse in the current situation, people going to stop and decide to spend one or two years of unemployment studying an opposition rather than seek employment. Do not blame them or accuse them of anything, is the normal response to an excessive privilege granted by the state to a small segment of workers.
short, I think the only part of the labor market should relax the state is that of civil servants, while the rest, given the current situation is better to focus on boosting recruitment and job search, instead of easier to fire and thus sow panic.
