Spain experienced Europe’s worst job destruction in first half of the year

Europe / Spain / 02/09/2020 / Author: Antonio Maqueda / Source: english.elpais

Old habits die hard: Spain is once again the European economy that has shed the most jobs in times of crisis. With the coronavirus pandemic still raging in many countries, job destruction in the first half of the year was nearly three times higher in Spain than in other European countries.

A strict lockdown, reliance on tourism and a high rate of temporary contracts help explain why employment decreased by around 8%.

Old habits die hard: Spain is once again the European economy that has shed the most jobs in times of crisis. With the coronavirus pandemic still raging in many countries, job destruction in the first half of the year was nearly three times higher in Spain than in other European countries.

And this figure does not take into account all the furloughed workers still under Spain’s ERTE scheme, which allows employers to temporarily send staff home or reduce their working hours. Once this state-funded job protection program ends, a clearer picture will emerge of the true impact of the coronavirus on employment. Other EU countries have introduced similar programs to combat the impact of Covid-19 on their economies.

Spanish companies have a very quick and effective way of adjusting costs: temporary workers are immediately laid off or else their contracts are not renewed

Between April and June, employment in Spain decreased by 7.5% according to Eurostat, the statistical office of the European Union. This comes on top of a 1% decline in the first quarter of the year. In other words, the number of employed persons dropped by around 8% in the first half of the year. Figures provided by Spain’s National Statistics Institute (INE), meanwhile, show that the number of employed individuals fell by 1.35 million between January and June.

By way of comparison, job destruction in Germany was 1.4% in the second quarter and zero in the first, according to Eurostat. while in France it was 0.2% in the first quarter and 2.6% in the second. And the United Kingdom only lost 0.7% of its jobs despite a similar drop in economic output as Spain’s.

This can partly be explained by the fact that one in three British workers, or 10 million out of 30 million, are on the equivalent of Spain’s ERTE furlough scheme, based on August data. The UK job-retention program also includes self-employed workers and grants beneficiaries up to 80% of their wages, up to a limit of £2,500 per month (around €2,240). Employment losses were 3.1% in the Netherlands, 4.1% in Austria, 1.2% in Poland and 1.3% in Sweden. Italy has yet to provide Eurostat with its second-quarter figures.

Not like 2008

This time is not like 2008, when Spain’s overheated construction sector was forced to adjust to the real estate crash and many jobs were lost for good. This time, the thinking is that the Covid-19 pandemic is a temporary evil and that workers’ wages must be protected until it passes. The tourism sector, for instance, is banking on a return to normal visitor flows once the virus comes under control.

Spain’s ERTE system, which finds inspiration in Germany’s Kurzarbeit, was originally created by former Socialist Party (PSOE) Prime Minister José Luis Rodríguez Zapatero to deal with the 2008 crisis. The scheme gained traction under Mariano Rajoy of the Popular Party (PP) and his 2012 labor reform. And now, Prime Minister Pedro Sánchez of the PSOE has rolled out the job-retention program to stem the tremendous flow of job losses triggered by the coronavirus pandemic.

Yet Spain continues to destroy more jobs than other neighboring countries. Spanish companies have a very quick and effective way of adjusting costs: temporary workers are immediately laid off or else their contracts are not renewed; this avoids problems with the permanent staff but has severe consequences on productivity and the social fabric of the country.

The INE’s labor force survey for the second quarter shows that two-thirds of lost jobs were temporary positions. The job-destruction rate was 2% among permanent employees and 11% among temporary workers.

But there were other factors at play. In mid-March Spain introduced the toughest lockdown in the world, as evidenced by Google’s mobility reports. This confinement triggered a 5.2% drop in economic activity in the first quarter and 18.5% between April and June. Only Britain experienced similar declines of 2% and 20.4%.

Another crucial element is the structure of Spain’s economy. Poland also has a lot of temporary workers, yet it only eliminated 1.2% of those jobs in the first half of the year. But Poland did not take such drastic measures as Spain against the coronavirus, and its economy is not as heavily dependent on tourism and entertainment – two activities that employ many temporary workers and which have been hard hit by the lockdown measures.

Temporary contracts

Over-reliance on temporary contracts has been a problem in Spain since the system was first used in the 1980s as a way to create jobs. No government has come up with an effective reform: former Labor Minister Fátima Báñez, of the PP, presented a plan that was never completed. And the Economy Ministry’s current plans for a severance-pay system based on Austria’s “backpack” model has been moved to the back burner due to the coronavirus crisis.

“Temporary contracts and short job duration are hampering young people’s ability to accumulate experience,” said Óscar Arce, the Bank of Spain’s director general for economics, at a recent presentation.

And in a recession, temporary workers who are made redundant are also cut off from full unemployment benefits, leaving them dependent on their own families for financial assistance.

English version by Susana Urra.

Source and Image:

Comparte este contenido:

‘I don’t know why the heck we have to go back if there’s no way of staying apart’

Europe / Spain / 04/15/2020 / Author: Miguel Ángel Medina, Eva Saiz And María Pitarch / Source:

Thousands of people are returning to work in Spain amid controversy over whether it is too early to lift the strictest measures of coronavirus confinement

At Príncipe Pio station in Madrid, on the Cercanías commuter train network, only the hum of escalators and the noise of arriving and departing trains could be heard on Monday morning. A dozen National Police officers were handing out more than 5,000 face masks just at this one station. Ten million masks will be handed out in total, now that some of Spain’s non-essential workers are returning to work after a two-week period during which the economy was placed in “hibernation” mode.

Rafael Antúnez, 53, did not need to take one. He arrived at the station around 6am with a mask used for painting that he had bought months earlier at a hardware store. “Before all this happened,” he said about the purchase, as he made his way to a construction site in the Madrid municipality of Pozuelo de Alarcón. “I don’t know why the heck we have to go back if there’s no way of staying apart.”

Asked whether he was afraid, Antúnez shrugged his shoulders. “I just hope that my workmates also work with a face mask,” he says. “If not, we’re screwed.”

Industry and construction are the main sectors resuming normal activity, although retail stores, restaurants, cultural venues and leisure centers remain closed as part of the general confinement measures in place since March 14.

Minutes later, a commuter named Irud passed by and said he was going back to work as a gardener in Las Matas, northwest of the capital. “I don’t know if it’s essential or not, but they keep calling me,” he said, hands in his pockets and half his face covered with a neck warmer. “How can you leave plants for so long without looking after them? It would be a disaster.”

A woman who said her name was Fátima did not stop to talk, but offered some information as she walked by. “I have never stopped working. I am a care worker at a residence,” she said. Asked about the situation there, she did not answer, and instead rushed to catch a train heading to Atocha station.

At Atocha, several security guards watched over the train platforms to make sure commuters remained an appropriate distance apart. Although there was more movement here than at other stations, the situation remained unusually quiet, with no sign of the bustle typical of one of the city’s busiest transportation hubs.

A municipal police office waits to hand out masks at Atocha station.
A municipal police office waits to hand out masks at Atocha station.DANIEL GONZÁLEZ / GTRES

Most of the commuters accepted the offered face masks even though they were already wearing one. Some covered their faces with scarves and homemade masks, while others wore none at all. Ismael Rubio, a bricklayer waiting for a train to Collado Villalba, said he did not believe in their effectiveness. “I don’t put [the mask] on because it doesn’t do anything,” he asserted. “Once you touch your cellphone or clothes, they’re stained.” Rubio said he was not worried about contracting the coronavirus, but was scared about infecting the elderly people he lives with. “But I don’t think this does much,” he said, showing the mask he picked up at the station, then placing it in his pocket.

According to the authorities, face masks will be distributed at public transportation hubs for a few more days, particularly in the eight of Spain’s 17 regions where Easter Monday is a public holiday.

Many of the people using public transportation on Monday were the same essential workers who were already using it before the temporary “hibernation” period – doctors, security guards, supermarket cashiers. Asier, for example, is a security guard who complained about having to wait 12 minutes for his train. “These frequencies don’t help maintain social distancing,” he noted.

But at 8am, in the middle of rush hour, the normally packed Metro train cars looked half-empty. Outside, police officers continued to hand out masks at different entrances, while two Red Cross volunteers gave out masks inside the train cars. “We are handing out [masks] at all the transportation hubs, and at the busiest stops,” said Carmen, one of the volunteers. By noon on Monday, 72,323 passengers had used the Metro train system, 31% more than Monday of last week but 87% less than the same day last year, according to figures published by Madrid Metro on its official Twitter account.

Building sites

Work on construction sites has resumed in Madrid. One such site is on a building that will be turned into a hotel on Montera street near Gran Vía, in the heart of the capital. “We have all returned to work today,” said Florin, a worker, wearing a traditional yellow vest and a less traditional face mask. The noise of the machines and workers’ conversations were the only sounds breaking the silence that hung over Madrid’s famous Puerta del Sol. Both spots are normally packed with people but on Monday they were nearly completely deserted.

Builders on a construction site in Madrid.
Builders on a construction site in Madrid.VICTOR SAINZ / EL PAÍS

Franklin Rodríguez was also going back to work on a building site. “We stopped for 15 days, but today we are going back. They have given us gloves and masks. I’m not afraid to return, we are protected,” he said as he waited at Puerta del Sol for a Metro train to take him to Iglesia station. Other workers also returned to a site on La Encomienda street, in Madrid’s La Latina neighborhood, where a new hostel is being built. “We start today, everyone has a mask,” said Herminio, directing a colleague as he handled construction material.

Few commuters in Seville

In the southern Spanish city of Seville, there were few commuters on the Metro line, where volunteers from the Civil Protection service, supported by state security forces, began handing out face masks at 6am. Most of the passengers on their way to work already had protective gear that they brought from home, and masks were only being handed out to people without them and who would not be provided with one at their workplace, according to one of the security officers.

A commuter in Santa Justa station in Seville on Monday.
A commuter in Santa Justa station in Seville on Monday.PACO PUENTES

There was more activity at Santa Justa station, which is one of the main transportation hubs of the city. Police officers there handed out masks to several passengers who did not have any protective gear, such as María, who works at a law firm and was commuting from the Bellavista neighborhood to the south of the city. “I was not sure if masks were going to be handed out or if they would have one for me when I arrived [at work],” she said. In the southern region of Andalusia, up to 1.8 million masks are expected to be distributed in 365 public transportation hubs in eight provinces. Out of this figure, 434,000 will be handed out in the city of Seville.

Castellón’s ceramics industry “slowly” resumes production

The reactivation of the ceramics industry has been slow and “different in each company,” according to the Spanish Tile and Ceramic Pavement Association (ASCER). Sources from ASCER indicated that the sector is “very far from returning to normal” and that activity will only resume slowly in the next two months. Monday is also a public holiday in the province of Castellón, the heart of Spain’s ceramics industry, which has slowed the return to business.

Sources from ASCER said that the sector will have to adjust production according to the demands of their clients, meaning it “will be a very long and complicated period for companies.” According to these sources, demand for ceramic tiles “has fallen dramatically in the last few weeks, because our main markets, like Spain, the European Union and the United States, have taken contingency measures to slow the spread of Covid-19.”

ASCER explained that “international producers who have not had to stop production” represent a major threat to the Spanish ceramics sector. The industry has called for more funding, urgent liquidity measures and the postponement of tax payments, among other measures.

English version by Melissa Kitson.

Source and Image:

Comparte este contenido:

Child undernutrition costing Kenya’s economy Ksh 373b: Study

Africa/Kenya/24-11-2019/Author(a): Ministry Of Health/Source:

Por: Ministry Of Health

The cost of child undernutrition to the Kenya’s economy is 373.9 billion shillings, which represents a loss of 6.9 percent of the Gross Domestic Product (GDP) as at 2014, this is according to a study. 

The study dubbed “ Cost of Hunger in Africa (COHA) – Kenya  chapter  touches directly on three sectors of the economy namely Health, Education and Labor productivity and using 2014 as a reference period shows that Hunger is one of the root causes of malnutrition in Kenya as well as Africa with the negative impact on children under five years.

The report says that despite Kenya having made progress in reducing stunting in children from a high of 33 percent in 1994 to 26 percent in 2014, stunting rates are still high since it affects 1 in every four children under 5 years.

In a speech read by the Cabinet Secretary for Health Sicily Kariuki, on behalf of  President Uhuru Kenyatta, during the release of the Cost of Hunger in Africa (COHA) Kenya Study report on Thursday, the President said scale up and diverse financing for good nutrition for a healthy and productive nation should be a priority  to address the challenges associated with malnutrition.

He therefore said there is need to work together and put in place a comprehensive mechanism to address challenges of child undernutrition.

He also called for strengthening of existing public private partnership in the implementation of the policy recommendations from the study

The President noted that the challenges associated with malnutrition have led to the need for focus and emphasis on nutrition as part of the development effort in the World.

“Recognizing that Children are the greatest asset of our Nation, My Government is committed to ending child undernutrition,” he said.

Child undernutrition and in particular stunting in children has a negative impact on productivity at a much later stage in life.  Kenya has reduced stunting in children from a high of 33% in 1994 to 26% in 2014.

“As a Government, we are committed to reducing the stunting rates to 14.5% by 2030,” the President said and thanked all the development partners, who have walked with the government on the journey of ensuring that children have a brighter tomorrow.

Speaking during the release of the report, Treasury Cabinet Secretary Amb.  Ukur Yatani who was represented by Albert Mwenda, Director General, Budget, Fiscal and Economic Affairs said hunger is unacceptable and must be eradicated especially in Africa.

“In 2018, the number of people who were hungry globally stood at 821.6 Million, which implies that one person in nine people, suffers from hunger. Approximately 31 percent of the World hungry people come from Africa, “he noted..

The economic impact of child undernutrition on the health sector therefore is at  KSh. 18.6 Billion, representing  0.3 percent of our GDP as at 2014 he noted.

Based on the findings, the CS said that COHA Kenya National Implementation Team  will strengthen the implementation of the nutrition component within the community health strategy,  disseminate and implement comprehensive school health and nutrition programme and also integrate nutrition as targeting component in social protection programmes for the highly vulnerable populations.

The Council of  Governors (CoG) representative, Transzoia CEC Mary Nzomo said, the report will be useful for the national and county planning and budgeting process as well as offer important source of  data in the mid -term review of the county integrated development plans and their implementation and the big four agenda  of 100 percent food and nutrition security.

The COHA study estimates the social and economic impact of child undernutrition and provides evidence based analysis on cost of hunger geared towards  implementing strategies that eradicate child undernutrition in the country.

Source and Image:

Comparte este contenido:

Need to give quality education in India to students who fly overseas: Rajan

India/March 27, 2018/By: Anup Roy & Nikhat Hetavkar/Source:

We have fantastic institutions. But remember, we have so many young children coming in now, looking for admission into colleges, says Rajan.

Eminent economist and former Reserve Bank of India (RBI) governor Raghuram Rajan is part of an elite group that launched a unique undergraduate liberal arts private university. In an exclusive chat with Anup Roy and Nikhat Hetavkar, Rajan says there is a need to give quality education in India to students who fly overseas every year. Edited excerpts:You are on the advisory council of KREA University. Will you be teaching also? Just like I was previously associated with ISB (Indian School of Business), I go there once in a while, I taught a course there, and I visit classes. My wife teaches there now. So, there will be an engagement of course. I am working with the academic council and the board. It’s a bunch of people who have come together. I don’t want to occupy any bigger position than I am holding now. I am merely helping, along with a large group of very dedicated people.You are a product of an Indian education system.What do you think the system is lacking now? We have fantastic institutions. But remember, we have so many young children coming in now, looking for admission into colleges. And our system is inadequate in terms of numbers to serve all of them with high-quality education. And of course, every time there is an opportunity to rethink what the old institutions are doing. Can we do things differently? Is there room for something new even when the old continues? We need more institutions to meet the demand. We have 100,000 students going abroad every year. So, we have room for at least 100 universities of very high quality to service those 100,000 students. We have the freedom to create a new model and that’s what is exciting.Why is Dr Rajan, who is very much a public figure, not engaged in the public education system, and why do you have to branch out to the private sphere? It’s not much of private. The intention is to make it available to those who qualify. There will be scholarships for those who can’t afford to pay. There is far more flexibility in creating a new institution when you come together without the existing structures.

That’s why it’s important to try and experiment outside the formal public structure.But even then the fee is Rs 700,000-800,000 per annum for a four-year course. This is what it costs. When we talk about IITs, you will have to look at what the true cost per student the country is paying. Now that is buried somewhere in the government budget. And students are paying only a fraction of it. I paid a fraction of the cost it took the country to educate me. With private institutions, the cost is all out there. If you want quality, you want to pay your faculty a reasonable amount, you want buildings as places in which you feel like learning, you have to spend money. What we are trying to say is that we will try and ensure that anybody who is admitted can afford to pay. Certainly in this country we can’t subsidise education too much.

Education inflation was always a worrying factor for you. Now that if you have such a high fee structure for a premier institute, there is a good chance that other private institutions will hike their fees. I don’t think the intention is to make enormous amounts of money here. This is a not-for-profit institute. What we will try to do is to keep it as affordable as possible. But you have to ensure a certain quality of education. Now if this institution turns out to be overly expensive, alternatives will come up. Competition will always work, even in the education market. We have lots of entities that can provide quantity, but we need to ensure that we have at least some that can provide quality. As I said, there are institutions that are very respectable out there.

Will it have courses like monetary economics etc, where you could be engaged? I think there would be a course in economics. Any course in economics will certainly teach undergrads micro economics, macro-economics and so on. The extent to which it specializes into master’s level courses that will have to stage two or three down the line. Initially what we want to give is strong undergrad curriculum for the students who are coming in.


Comparte este contenido: