Spain among OECD countries with highest rates of ¡°involuntary¡± part-time work

Six years on from labor reforms aimed at making Spain¡¯s labor market more flexible and generating jobs, unemployment remains stubbornly high, wages low, and greater numbers of people than ever are only able to find part-time work, concludes the latest data by the Organization for Economic Cooperation and Development (OECD).

The organization¡¯s Employment Outlook 2016 report shows that 63.4% of part-time workers in Spain are ¡°involuntarily¡± so, which is to say that they would like to work full-time, but are unable to. In Greece, Slovakia and Italy the figures are even higher. Women are particularly affected by the problem.

The OECD notes that around 14.5% of Spain¡¯s workforce is employed part-time, representing some 2.8 million people. Of these, around 1.75 million would work full-time if they could, a huge increase from the 750,000 who were in that position when the crisis began in 2008.

The OECD also draws attention to Spain¡¯s NEETS: young people not studying, training, or actively looking for work

That said, in its report, published this month, the OECD is relatively upbeat about Spain¡¯s prospects nearly ten years after the global financial crisis erupted. It notes that labor market conditions continue to improve and the average employment rate is projected to return to its pre-crisis level in 2017.

Labor market reform has helped tackle deeply entrenched labor market segmentation by strengthening the incentives for employers to hire on open-ended contracts, says the OECD. And although temporary employment still accounts for 25% of all employment, this remains well below its pre-crisis share of almost 32%.

However, it warns that temporary contracts still account for a large majority of new hires, and additional reforms to reduce the gap in termination costs between open-ended and fixed-term contracts may be required to reduce segmentation even further.

The OECD also draws attention to Spain¡¯s NEETS: young people not studying, training, or actively looking for work. AT 12.9%, the share of young people in Spain who are low-skilled NEETs is one of the highest among OECD countries, and remains 3.4 percentage points above its pre-crisis level. ¡°While part of this increase reflects the high cyclical level of youth unemployment, a majority of low-skilled NEETs are inactive rather than unemployed,¡± says the report.

Low-skilled young people are more likely to be NEETs than their better educated counterparts. The low-skilled share of all NEETs exceeds 50% in Mexico, Spain and Turkey. The share of young NEETs actively searching for a job in 2015 was also lower for those who did not complete high school (24%) than for the more educated (37%).

Slightly more than one-third of young NEETs live in a jobless household (i.e. a household that does not contain an employed adult). This share rises to 44% for low-skilled NEETs, suggesting that many in this group risk facing both poverty and limited labour market opportunities, concludes the OECD.

English version by Nick Lyne.?