The Unassuming Economist

A new IMF report finds that “Over the past three years, the Spanish labor market has seen a strong turnaround, recovering more than a third of jobs lost during the crisis. This rebound has taken place on the back of significant wage moderation and regained external competitiveness, supported by labor market reforms. Employment has been growing across sectors, with services accounting for 80 percent of net employment creation, marking a sectoral shift away from construction. Except for some fast-growing smaller sectors such as information and communications, the new service-sector jobs are generally in the lower-productivity segment, including in tourism-related activities, and just over half are of temporary nature. Job growth has also varied across regions, reflecting different employment situations and sectoral specializations. Generally, the newly created jobs make sub-optimal use of existing skill patterns in Spain, with over-skilling becoming more prevalent and persistent skills gaps among the lower-educated preventing many from finding employment.”