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Spain’s much-vaunted economic recovery masks lingering jobs crisis

Data shows Spain’s economy recovering, but tell that to Javier Pichel: this summer he packed and left for the only place he could find a decent job — Germany.

Spain’s much-vaunted economic recovery masks lingering jobs crisis
Locals make a human chain in the city in Valladolid in 2014 to demand decent jobs and a basic income. Photo: Cesar Manso/AFP

Millions of Spaniards are scraping by on benefits, family handouts or working cash-in-hand as they wait for the apparent economic rebound to create the hundreds of thousands of jobs the government is promising.

Experts say that these jobs are being created — but that the problem is many of them only last a few days.

Since leaving school, 22-year-old Mr Pichel from the northwestern Galicia region has racked up training certificates in finance and business, but has received no decent job offers in Spain.

“You can get a contract for three weeks or three months. You’re happy, but you quickly realise that there is no job security,” he said.

Spain’s government is forecasting the economy will grow by 3.3% this year, one of the strongest rates in the eurozone.

Prime Minister Mariano Rajoy in 2012 passed reforms making it easier for firms to hire and fire as part of his austerity reforms.

Now he has promised a million jobs would be created over the 2014-2015 period.

Mr Pichel and others his age find that hard to imagine. Opposition parties and labour unions dispute the diagnosis given by the conservative government, which is preparing to fight for re-election in December.

Spain’s unemployment rate remains extremely high at more than 22%. One in every two eligible workers under the age of 25 is out of work.

“Every month in Spain 1.5-million contracts are signed. That’s 18-million a year. So what’s going on? These are contracts for just a day’s or a week’s work,” said Manuel Lago, an economist in the major union CCOO.

“Employment in Spain is very seasonal. Jobs start getting created shortly before Easter and the unemployment rate goes down all summer” before ticking back up in August.

Anna Laborda of ESADE business school in Barcelona agrees that the jobs being created in Spain are “very unstable” ones.

Labour ministry figures show that one quarter of all contracts signed in the first half of this year were for a week’s work or less.

“If the unemployment rate has gone down, it is only because the number of people eligible to qualify as job seekers has decreased” due to emigration, said Ms Laborda.

Spain suffered two recessions after its housing bubble burst in 2008. It returned to growth in mid-2013.

Many of the millions of immigrants who were drawn to Spain during the prior boom years were driven away by the crisis.

Young people with qualifications and languages have followed, since all Spain seems to offer is “seasonal or unsteady jobs”, Ms Laborda added.

Despite his business diplomas, Mr Pichel had been scraping a living by refereeing football matches at weekends.

Then he landed a three-year contract at a bank near Dresden, including a fixed salary, housing and four paid return journeys to Spain a year.

Two other Spaniards have since joined him at the bank.

“I pulled the long straw,” he said. “It sounded too good to be true.”

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WORKING IN SPAIN

Ten business ideas that could work in Spain (Part II)

Spain's Startups Law is now in force, so if you're thinking about moving to Spain and starting up a business, here are ten niche ideas that have been successful abroad, but are still fairly new in Spain.

Ten business ideas that could work in Spain (Part II)

Back in November 2022, we published a list of nine bright business ideas that haven’t been exploited yet in Spain and now we’ve come up with 10 more to give those of you thinking of creating a startup here, lots of inspiration. 

Spain’s new Startups Law has many enticing perks and reduced tax rates for foreign digital nomads, entrepreneurs, investors and remote workers who want to start a business or work in Spain.

READ ALSO – New details: Spain’s rules and benefits for foreign startups

Networks against food waste

Food waste is a big issue in our society and lots of perfectly good food gets thrown out every day because it’s past its sell-by date. Companies like Too Good To Go have already started tackling this issue here in Spain, but there is still room for many more. The idea is to ​​create a sustainable business model that has a network of shops that can avoid throwing away perishable products by connecting them with customers who want discounted products that they have to consume quickly. 

DIY decoration stores

There are of course stores in Spain such as Leroy Merlin and Bricorama that sell everything you need for your home DIY projects, but what about a simpler type of shop that focuses just on décor instead of all the tools and technical parts that professionals use too?

In France, there are several chains of shops such as 4murs and Saint Maclou that do exactly this. They are solely dedicated to the decoration of walls and floors and sell items such as paints, tiles, wallpaper, rugs and curtains, items that the everyday person can use.

Machines to re-charge mobile phones and sell accessories

We’ve all been in that situation where we are out and our battery is really low and we’re scared of using our mobiles in case we run out of power and then we’re stuck, unable to contact anyone or even use Google Maps and find out where to go. While there are occasionally places to recharge your phones in airports or shopping malls in the larger Spanish cities, dedicated mobile charging stations could be the next great business idea.

In China, this is already a successful startup and now mobile charging vending machines can be found all over. They also allow customers to buy batteries, cables, headphones and chargers, something which some of the vending machines in Barcelona metro stations already do.

READ ALSO: Buying a franchise in Spain – the cheapest and best businesses to set up

A business that will look after the needs of your car

Busy car owners these days may not have the time to take care of their cars and carry out all the necessary cleaning and repairs. Here’s where your business could come in, offering a range of services from simple tasks like washing or something a little more complicated such as taking your car to the garage to pass its ITV (MOT) test.  An example of this is Cafler, which has been dubbed the Glovo of the automotive sector.

A one-stop shop for all car services for the busy professional could be a successful idea. Photo: Dariusz Sankowski / Pixabay

Services for the over 65s

Spain has an aging population and experts predict that by 2035, in just 14 years, around one in four (26 percent) of Spaniards will be 65 or older. This opens the door for many types of businesses directly serving this age group. Examples of this are startups such as Viejenials, a company that is committed to alternative aging through modern dance for people over 50 or Sasoibide, a company that takes older people on nature walks to help combat loneliness.

Services to help students move abroad

Many Spanish students dream of moving abroad temporarily to help improve their English language skills, but an international move and all it entails can be quite a difficult and daunting task. As a foreigner, you could be in a great position to be able to market and organise relocation services and language packages in English-speaking countries such as the UK, US or even Australia.

Companies such as YouTOOProject have already been successful at helping to solve problems that arise during students’ stays in their new countries.

Rent a butler  

Butlers may just be for the upper classes you think, or only if you lived in the past, such as during the time of Downton Abbey, but renting a butler for events or parties is becoming more and more popular. ByMayordomos is web portal that offers people the possibility of having a specialised butler at short notice, but there are lots of possibilities for more companies to do something similar.

A business to rent a butler could take off in Spain. Photo: Vic Padilla / Pixabay

Services for the self-employed and small businesses

Spain has around 3.3 million self-employed people or autónomos, which accounts for 16 percent of the population. This means that there’s plenty of scope to set up businesses aimed at this sector. There are plenty of gestores (similar to accountants) helping freelancers with their taxes, but there are lots of other services that could be offered such as consulting services, and helping people digitise their businesses by creating website, design or software.

Sustainable packaging companies

In January 2023, a new tax came into force in Spain on the use of non-reusable plastic packaging, and companies, particularly food manufacturers, as well as others, are desperately looking for ways to make their packaging more sustainable.

More and more entrepreneurs are betting on zero-waste business models and are looking for everything from boxes and labels to protective packaging to be sustainable and plastic free. Creating these types of solutions for other businesses could be a profitable idea.

At-home cooking classes

Most people sign up for a cooking class or school if they want to be taught by the professionals, but what about chefs who can go directly to your door? It could be a novel idea for parties or even as gifts for foodies.

As a foreigner, you could think up ideas that might not already be available here, such as sushi-making classes or learning how to make Mexican tortillas from scratch. It could focus on vegan cuisine, gluten-free cooking or even private classes for children or beginners. One company – Summumm, in Madrid has already made a success of similar services such as show-cooking at home too. 

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