February 2015, on Spain’s unemployment figures: “It is the first good year of net job creation since 2007, but there is still a way to go”, by Prof. Javier Díaz-Giménez
The unemployment rate compared to 2013 expected
- The unemployment rate numbers are in line with expectations. After the huge levels of job destruction, it is inevitable that people are starting to hire again as Spain has returned to growth.
- While it´s true the unemployment rate has fallen more than expected by the government, the participation rate (the number of people actively looking for work) has also increased.
The good news - jump in job creation; bottoming out of construction sector
- The key figure to note is that this is the first good year of net job creation since 2007.
- The other piece of good news is that the construction sector has created 40,000 new jobs. This implies a bottoming out of the construction sector and perhaps more jobs to be created in 2015.
- However, we are still more than 3 million jobs shy of the maximum job creation level in 2007, so there is still a way to go.
January 2015, on Spain’s GDP and IPC figures: “Growth is sustainable and accelerating”, by Prof. Juan José Toribio
Increase in GDP for 2014 – Growth is sustainable and accelerating. Why?
- Factors behind the growth: exports and investments. They are dynamic and still continuing.
- Private consumption is going up.
- Investments in real estate have stopped falling.
- Government expenditure: as 2015 is an election year, we can expect a small increase.
- Labor reforms have helped too.
IPC at historical low, but not cause for panic (it’s not due to a decline in demand):
- Unlike most countries, this drop is not due to a decline in demand but due to a fall in the price in oil and energy, combined with an increase in productivity. The effect will be positive in the end.
- It could be negative if people postpone consuming goods in the hope of lower prices to come, but as we are largely talking about oil this is unlikely. Most people buy oil when they need it.
December 2014, on Google News Spain shutting down and the Government’s reform of the Intellectual Property Law: “It is not reasonable to make this tax unavoidable.”, by Prof. Josep Valor
- This measure only benefits publications which already have a strong brand in Spain (big media). However, small media (those who benefit most from the traffic generated through a presence on Google News) will be negatively affected. Up until now, Google put big and small media at the same level of competition through indexation.
- It is not reasonable to make this tax unavoidable. It would be logical for news authors to get economic compensation from aggregators´ (such as Google) use of their content only if the authors agree (this is the model followed by other countries.) If an author believes Google News doesn’t add value to their publication, Google has to pay. But if it adds value and generates traffic, the tax should be zero.
October 2014, on the Ebola contagion in Spain: “The risk could have been minimized with the participation of fewer but better trained health professionals”, by Prof. Jaume Ribera
Authorities are attributing the contagion to a chain of errors. This includes probably a human error due to several factors:
- Lack of experience: Spain has only treated 2 cases of Ebola in its entire history.
- Lack of practice of the hospital staff in charge of the two infected patients.
- Failure in the error detection system (the nurse should have been monitored to check that she was removing her suit correctly.)
It is a clear case of crisis communication: the image of the Spanish healthcare system has been damaged due to a poor and opaque communication strategy. It is important to inform the public with facts and explanations on why the contagion has taken place and what measures will be taken to avoid this situation in the future.
April 2014, Unemployment figures: “Why this time we might see jobs being created even with minimal growth”, by Prof. Javier Díaz-Giménez
The elasticity of employment
- Traditionally Spain has had short recessions and high firing costs – that’s lead many to believe that Spain only creates net employment when its GDP grows at 2% or more.
- But this time it’s different: this recession has been the deepest and longest in the last 30 years and the two labor market reforms have reduced firing costs.
- Companies that have survived the recession might have shed their surplus labor and adjusted their labor force to a shrinking market.
- In this case we might see net jobs being created with even minimal growth.
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