If there is a cliché that continues to be repeated in many analyses of work in Spain, it is that “older” workers constitute a burden that slows down the entry of young people into the labor market and condemns them to lower quality jobs. However, this idea contrasts with SEPE data that show that Those under 30 are more likely to sign a permanent contract than seniors.. Of course, they also confirm that when they are fifty Your chances of finding a job drop.
Last August, the State Public Employment Service (SEPE) recorded the signing of 1.04 million contracts. Those under 30 signed 41.09% of the total contracts, while those over 50 signed 16.81%. This is despite the fact that There are more unemployed people over 50 (which can be interpreted as available labor) than those under 30 years old.
These data alone would not call into question the idea that young people suffer from greater job insecurity than “seniors”. If they have more temporary jobs (i.e. they experience more turnover), It makes sense that they sign more contractsBut this argument runs up against the reality of the latest figures.
Of the total contracts in August, 389,375, 37.5% of the total were for an indefinite period. Among them, young people signed 41.01%. Those over 50, 15.6%. In other words, the same distribution p is recordedThe seniority of total contracts is maintained for permanent contracts. In view of these data, doubts arise as to whether labor reform has anything to do with this gap in opportunities between workers of different ages.
The fact is that this gap already existed well before the legal change and with practically the same percentages. In August 2019, young people “took” 37.29% of the total contracts and 41.32% of the permanent contracts, compared to 14.98% for general hiring. and 17.98% of the fixed salary received by “seniors”.
The big difference between the two data is that today, many more permanent jobs are being created. Five years ago, only 8.11% of all contracts were permanent. Last month, the rate reached the aforementioned 37.5%.
Indeed, the impact of the reform on improving the quality of hiring in each age group is similar: 37% of contracts signed by those under 30 are of indefinite duration (in line with the general average), while for those over 50, it is 34%. Before the reform, only 7.2% of contracts signed before the age of 30 were of indefinite duration, while for those over 50 it was 7.8%.
Contradiction between SEPE and EPA
After analyzing the hiring data, many doubts arise. The first is how to explain that the Labor Force Survey indicates that the unemployment rate of workers in their first fifteen years of working life (the statistics start counting at 16) have an unemployment rate of 19% when those who are in their last fifteen years, that is to say from 50 years old remains at 9.7%.
It is necessary to take into account the demographic effect of population aging; The active population (people who work or want to work but are unemployed) over 50 years old number 8.41 million, while those under 30 years old only reach 3.98 million.
Thus, even if the number of “senior” unemployed is older than that of young people (820,500 versus 786,000), the rates are very different. But according to this same rule of three, the occupancy rates are also: e80.24% of those over 30 have a job, compared to 90.2% of those over 50.
The contrast between the contract signing figures published by the SEPE and the employment figures from the EPA is more striking if we look at employees under temporary contracts. In the second quarter, they reached 15.95% on average overall, but climbed to 33% among those under 30. more than three times higher than that of those over 50, which was 9.77%.
As in the case of unemployment, the demographic factor can be used, but here its weight is lower: the fact is that despite the fact that employed people under 30 represent half of those over 50 (2.9 against 6.03 million), the number of temporary workers is almost double: 1 million against 589,000.
Flexicurity and labor reforms
Such data support the idea of many economists and politicians that the over-50s “keep” their jobs and thus “stop” the entry of young people into the labour market, an argument that has been used historically to justify measures such as the promotion of early retirement, but also for policies that sought to promote “flexicurity”, that is, to facilitate the “rotation” of workers to encourage the replacement of workers.
This idea has influenced the last two labour reforms in different ways and with very different approaches. The 2012 reform chose to reduce the cost of dismissal (by clarifying the causes of objective dismissals and reducing the compensation for people declared inadmissible) by arguing that This would encourage the creation of more stable jobs.even if the results in this regard were rather in the opposite direction (recall that in August 2019 thePermanent contracts do not reach 9% of the total).
The 2021 law, on the contrary, acted on the types of hiring, by eliminating temporary workers for work and service and by tightening the conditions for temporary hiring (still without touching the cost of compensation). This, as we have seen, had the effect of triggering permanent hiring (even if some were discontinuous permanent contracts) in all age groups. But none of these changes corrected the contradictory gaps between the employment of young people and that of “seniors”, is analyzed according to SEPE contracts or according to EPA contracts.
Labor market analyses typically consider LFS data before hiring or placement data, which are viewed as a simple record of volatile employment relationships. But for that very reason, they represent a complementary thermometer of employment opportunities to that of the LFS, which is based on a fixed “stock” of employed people. It can be said that the INE data reflect the way in which existing jobs are distributed and the opportunities to access them.
The unemployment trap
This is where the statistics on the flow of the active population come into play, which measure quarterly variations in INE data on employment and unemployment and indicate that young people are proportionally more likely to become unemployed than “seniors”, but they have more difficulty taking the opposite path, that is, finding a job.In other words: a 50-year-old who loses his job is more likely to remain unemployed for the rest of his working life.
This is confirmed if we look at the data on placements of unemployed and job seekers that the SEPE also records. Here a no less surprising phenomenon occurs.
The over-50s represent 45.99% of registered unemployed, which is explained not only by demographics but also by the fact that it is easier for them to receive unemployment benefits or a subsidy. The under-30s, for their part, only reach 14.19%. However, it obtains 29.22% of job seeker placements, compared to 23.03% for seniors.. A significant difference that reflects the disparity in employment opportunities based on age.
And this may help explain the contradiction in the data on the generational employment gap. Older workers are not appropriating job opportunities, but are instead clinging to their jobs precisely because they know that their hopes of finding a job if they lose the one they have (or of finding something better) are nil. And it is no longer because of “competition” with young workers, but because companies do not have any.. The same companies that are increasingly talking about difficulties in finding work.
But it also harms young people, beyond the “resistance” to their entry into the job market. Even if today your chances of signing a permanent contract have increased thanks to the labor reform, A person under 30 is very aware that in 20 years he will see his their career expectations, so they make other types of long-term decisions, from saving to starting a family.
A scenario, in short, in which job changes and demographics combine with many preconceived ideas and incomplete data analysis to continue to feed the loop of ageism that traps both “seniors” and “juniors.” and continues to harm employment in Spain.
