REFILE-FEATURE-Southern Europe’s lost generation stuck in junk jobs
* Italian, Spanish, Portuguese economies harmed by junk jobs* 1,000 euros a month was once a curse, now it’s a dream jobBy Fiona Ortiz and Feliciano TiseraMADRID, Oct 17 (Reuters) - Silvia knew things would be
tough, but never like this.With a masters’ degree in publicity, the 24-year-old has
been working for more than two years, full-time, in an
internship that is starting to feel like it will never end.Paid 300 euros a month for the same work as the salaried
public relations professionals who sit next to her, she doesn’t
earn enough to move out of her parents’ house and her bus pass
and lunch expenses eat up most of her pay.But despite feeling her multinational employer is flouting
rules that limit the use of worker contracts with no benefits,
she’s not about to complain to the labour office since she
considers herself blessed to have a job at all.”Since I was little my parents urged me to get a university
degree to find good work. But I’m lucky to have any work at all.
There were 30 of us in my graduating class and I’m one of the
ones who is doing the best with their career,” Silvia said. She
did not want her last name used in case of repercussions at
work.With Spain’s youth unemployment higher than 40 percent and
its overall joblessness the highest in the European Union at one
in five, young professionals accept any conditions as they try
to start their careers.The story is much the same in neighboring Portugal and Italy
where more and more people have so-called junk jobs: temporary
contracts that used to be common in tourism, farming and
construction but are now used by all kinds of companies.With the economy sluggish and the euro zone debt crisis
strangling credit, businesses are keener than ever to avoid
open-ended contracts with expensive severance pay.A quarter of Spain’s workforce is on temporary contracts, as
is 23 percent of Portugal’s, compared with a European Union
average of 14 percent.In Spain, Portugal and Italy, a rigid dual system has
emerged. Middle-aged people have stable jobs with benefits. They
are expensive to fire and protected by masses of legislation.
Meanwhile, younger workers are stuck in a revolving door of
temporary contracts that are easy to abuse.The two-track job market is stunting economic growth,
studies show. Temporary workers get trapped for longer and
longer periods without benefits, which affects output and makes
southern Europe less competitive.”You cannot just leave one segment of the labour market
fully untouched and not motivate people to go to the job where
they fit best… you might create employment in the short term
but in the end it’s a dead-end road,” said Ton Wilthagen, a
labour expert at Tilburg University in the Netherlands.1000 EUROS A MONTH AIN’T SO BAD AFTER ALLThe curse of the mileurista — the Spanish-language term for
a temporary worker who earns a thousand euros a month without
benefits — is not new. Young professionals in southern Europe
have found a permanent position elusive for some time.But the lost generation has wandered deeper into a maze as
the euro zone debt crisis intensifies. Economic growth is
slowing again and public sector jobs are disappearing as
governments try to bring huge public deficits under control.”We used to talk about mileuristas like it was a bad thing.
Now it’s good. A 1000-euro a month temporary contract is
decent,” said Jose Maria Marin, labour expert and contemporary
history professor at Spain’s National University of Distance
Education.In Rome, 27-year-old Federico has moved from one temporary
job to another since he graduated in history in 2009. A
1000-euros-a-month is starting to look like an unobtainable
dream.”I was interviewed today for a one-year job but I didn’t
like it because they were offering me 500 euros a month to work
10 hours a day,” said Federico, who did not want his last name
used since prospective employers could search for him on the
Internet.So far he has held out for a job in his chosen field of
media or marketing. He wants to move out of his parents’ house
but he needs a permanent job contract in order to sign a rental
agreement. With more than a quarter of Italians from 15-24 years
old out of work he’s starting to get desperate.”Sometimes I feel frustrated, and I start to send off lots
of CVs, even to companies I don’t like, just so I have more
chance of finding something,” he said.The phenomenon of young people living with their parents is
another thing holding back economic growth, creating a vicious
cycle for job creation. If they were setting up new households
they would be stimulating the housing market as well as consumer
spending.Another risk for economies with high percentages of
temporary workers, notes Wilthagen, is that banks are shy of
lending to people without permanent employment, further holding
back consumption.FOOT IN THE DOORTheoretically, a temporary contract is a foot in the door to
prove yourself as a good hire.But in southern Europe many supposedly temporary hires renew
contracts year after year and do the same jobs as the permanent
hires around them, just without the job security or benefits.
This creates an enduring second-class job tier similar to the
phenomenon of “permatemps” in the United States in the 1990s.In Spain only 20 percent of temporary contracts led to
permanent positions in 2008, one of the lowest rates in the
European Union, according to a study by Ruud Muffels, a labour
market expert at Tilburg University. His analysis of Eurostat
data showed that mobility was better in Italy and Portugal.Pedro Portugal, a labour market expert at Nova University in
Lisbon, said conversion rates of temporary contracts to
permanent ones have decreased in Portugal to under 20 percent
from 50 percent in the late 1990s.Many Portuguese companies abuse a freelance contract called
the “green receipt,” using it to hire full-time, in-house
workers, said Joao Labrincha, an organizer of marches earlier
this year against state austerity measures.He said that “green receipt” workers often have fixed
schedules like any other employee, but have no right to
holidays, social security, health insurance or severance pay.Even the government misuses the contracts.”I’ve worked for the state under green receipts for more
than five years. The system is rather perverse. Many of my
colleagues are also under these precarious conditions, some of
them have been temporary workers for the last 10 years,” said a
middle manager at the Portuguese Institute of Museums, who asked
not to be named.It’s difficult to transition into a permanent job when no
such posts are being created. In Spain, 80 percent of new job
contracts signed in the last decade were temporary contracts —
businesses just aren’t creating permanent positions.”Firms tend to link temporary contracts, to chain one after
the other, with the effect that very few young people get
transformed from temporary to permanent. This has a very
negative impact on young people starting their careers,” said
Anita Woelfl, economist with the OECD.ANY JOB IS BETTER THAN NO JOBIn 2010, under pressure from the European Union to reform
its labour market and make it easier for companies to hire and
fire, Spain’s Socialist government passed reforms meant to phase
out temporary contracts and make permanent contracts cheaper for
employers.But less than a year later the government did a U-turn after
the 2010 reform failed to put a dent into the country’s
unemployment rate, which continued to rise.”We’d rather have people on a temporary job than without a
job,” said Labour Minister Valeriano Gomez when the government
rolled back the reforms, introducing new rules that allow
companies to extend some temporary contracts for up to three
years.Spain is becoming a country of people who are “apprentices
until 33 and can’t retire until 75,” said union leader Ignacio
Fernandez Toxo, criticizing the new rules, which included a new
type of contract that gives companies more leeway to hire
trainees for extensive periods with no benefits.The extended trainee contract was designed to retrain
jobless men now in their late twenties or early thirties who
dropped out of school as teenagers during Spain’s housing boom
to work in well-paid construction jobs until the building sector
collapsed in a pile of bad debt.In Portugal, where the jobless rate is 12 percent,
significantly lower than Spain’s, the government has stuck to
reforms that reduce and cap severance pay.Juan Jose Dolado, an economist at Madrid’s Universidad
Carlos III, said Spain should have kept its eye on the long-term
goal and moved the country toward a one-contract system with
phased-in severance pay benefits.”It was like crossing the river and being in the middle.
They got scared in the middle, they didn’t move forward to reach
the other side, they went back,” Dolado said.The Socialists, expected to lose Nov. 20 general elections
after eight years in power, are now campaigning on pledges to
crack down on abuse of temporary contracts.The centre-right opposition People’s Party, or PP, poised to
win the November vote, says it wants to revive the original
labour reform and move Spain toward one type of job contract,
such as the one Dolado envisions.But analysts say the PP may also flinch when it comes to
cracking down on temporary contracts because they worry the
short-term effect will be to put people out of work at a time
when joblessness is the top concern of Spanish voters.Meanwhile, workers like Juan Francisco Seller, will continue
to give their labour away, hoping a “real” job materializes.
Seller is 27 and has a pharmaceutical degree. He’s been working
for free in a hospital in Valencia for a year, doing research
with a laboratory team.He has turned down paid work outside of his field, in order
to keep his C.V. professional.”I’m one of those who have patience and I’m really clear
that other options don’t appeal to me and I really like this
field,” he said. But “in the end it drives you crazy.”
