Reasons for the High Unemployment Rates in Spain
Paper GUIDELINES
for MacroEconomics 2301
for Phillip Tussing, Economics Instructor
Minimum 1,200-word Paper on a topic of interest to the student
Approval in advance: Topic for Paper must be approved in advance by the Instructor. It must be about:
1. a real situation (current or historical, anywhere in the world) which illustrates one of the principles discussed in this course, as supplemented by information from research.
OR
2. an Economist most of whose work was in Macroeconomics, who refers to a principle discussed in this course.
Grading Rubric: in three equal parts (too short Papers will receive reduced credit):
1. Paper considerations (33%): Writing ability, over minimum length, knowledge of the topic, grammar & spelling (use a Spellcheck). Use MLA, APA or Chicago Style rules.
2. Research (33%): A "Works Cited" page must be included, with not fewer than three (3) academic-level references, whether online or hardcopy, PLUS a reference to the specific relevant section of the Textbook -- for a total of (4) references -- Wikipedia is NOT acceptable as a reference, NOR ANY dictionary, NOR is a blog, nor general news sites such as Fox News, USA Today, Huffington Post, etc. The Economist is fine, as are The Wall Street Journal, Forbes, Business Week, and other reputable business-oriented publications. "Works Cited" page MUST be included. Simply listing the url of websites is NOT ACCEPTABLE -- they must be identified clearly, stating the writer if known, publication, date, etc, as with any normal reference.
3. Analysis (33%): Topic must be specifically related to an Economics topic as studied in our class, WHICH MUST BE IDENTIFIED (for example: unemployment, inflation, economic growth, etc.), using a graph or description clarifying how the situation or economist in the Paper added to our understanding of this topic.
Cheating by copying from the Internet without quotation marks or citation can lead to a zero on the assignment at my discretion.
Topics:
Macroeconomics students must use as a topic economy-wide subjects. A few possibilities are:
-alternative allocative mechanisms (e.g. Command economies like Cuba or state-dominated economies like China, Russia or France),
-aggregate supply and demand analysis for the USA or some other economy over a business cycle, such as 2001-2009 or 1873-1879 or 1921-1933 or 1929-1939, etc, (for which see the "Business Cycle (Recession and Recovery) Page at www(dot)nber(dot)org)
-national income accounting for some country in some year with inputs for various sectors, with an analysis of why that country heavily produces in a given sector, such as a labor-dependent economy (such as Bangladesh or China or Vietnam), a mostly services economy (like the US or UK), a capital-dependent economy (like Germany), a manufacturing economy (China, Korea, Taiwan or Germany), or a resource-dependent economy (like Saudi Arabia, Curacao, Democratic Republic of the Congo, Venezuela, Russia, Canada),
-employment or unemployment levels in a given country (such as Greece or Spain, or Thailand, or group of countries, such as the Eurozone, or a state like Texas or North Dakota, or a region such as the Mid-West, or even a city like Houston or New Orleans or Las Vegas) at some period, with an analysis of why it is at the level it is,
-economic growth at a given stage in some country (such as Brazil under the generals, or South Korea under Park Chung-Hee or North Korea under Kim Il Sung, or a state, such as Texas or California or Florida, or a city like Houston, Los Angeles, Chicago), and why it is growing as it is,
-poverty in a given country (such as Niger, Somalia, Afghanistan, the USA, Denmark or Mexico) and why it is at the level it is,
-inflation or hyperinflation in some country at some period (Germany in 1923, Zimbabwe in 2008, Hungary in 1947, Brazil 1980-94, current Venezuela, etc.) and why it is at the level it is,
-international trade of a given country (China, Germany, Saudi Arabia, Bangladesh, etc), and why that country predominantly produces products which heavily use a particular resource of production,
- developing country economics (Ghana, Bolivia, Mongolia, Jamaica, etc) and why it is at a particular stage of development,
-budget deficits somewhere (Greece, Japan, the USA, the UK, France, Italy, Ireland), and why they are the size they are,
-trade deficit somewhere (the USA, the UK) or surplus (China, Mexico) & why they are the magnitude they are,
-fiscal policy of some country (the Sequester in the US, Italy, Germany, France, Denmark) & why it includes a given level of taxes or government spending with respect to overall GDP and with respect to the national budget,
-monetary policy somewhere (the US, Japan, the Eurozone, Canada, China, Russia) & why
-health care (USA, Cuba, France, the UK, Canada)
-energy (the US, the UK, Germany, China, Europe, Brazil)
-pollution (in China, the US, Ecuador, Nigeria, the Czech Republic)
-climate change (and economic effects on the US, Bangladesh, Pacific island countries, China, Netherlands, Saharan countries)
-immigration (US, UK, Russia, France, Hong Kong, Japan, Saudi Arabia, Qatar)
-aging and/or shrinking populations (Japan, US, Russia, Europe)
-urban sprawl (the US, Nigeria, Egypt, China, India, Mexico, the UK).
Possible locations for finding topics and/or relevant research:
Bureau of Labor Statistics: http://www(dot)bls(dot)gov/bls/topicsaz.htm
Bureau of Economic Analysis: http://www(dot)bea(dot)gov/
World Bank: http://web(dot)worldbank(dot)org/WBSITE/EXTERNAL/DATASTATISTICS/0,,menuPK:232599~pagePK:64133170~piPK:64133498~theSitePK:239419,00.html
CIA Country Facts: https://www(dot)cia(dot)gov/library/publications/the-world-factbook/index.html
World Trade Org: http://www(dot)wto(dot)org/english/res_e/statis_e/Statis_e.htm
Intl Monetary Fund: http://www(dot)imf(dot)org/external/pubind.htm
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The Rate of Unemployment in Spain
The rate of unemployment is identified as the percentage of unemployed individuals within the legal working age in a country’s labor force. The degree of unemployment in Spain is a serious concern since it has reached high levels second to Greece. Greece has the highest unemployment rates in Europe. Understanding what causes the high degrees of unemployment in the country is crucial since it reveals the various ways in which the situation can be resolved. Thomas Piketty, a French Economist,has helped build an insight into the current situation in Spain. In his best-selling book, “Capital in the Twenty-First Century”, Piketty analyzes how the level of unemployment has affected the economic growth countries (Piketty 615). The rate of joblessness in Spain from 2007 to 2013 reveals the how the country has struggled with unemployment since the state recorded the lowest economic growth.
Unemployment in Spain
After the global recession that hit the world in 2008, countries such as Spain have never fully recovered. A decade before the economic downturn, the economy in Spain was vibrant. The global recession continued to trouble the Spanish economy for the next five years, and the rate of joblessness in the country spiked up to 26 percent (Country at a Glance: Spain). That is high percentage considering that it is four times higher than in the United States and it has been reported that the situation is likely to remain the same up to the next ten years. It has been estimated that between 2007 and 2013, during and after the global recession, more than 3 million people lost their jobs in Spain (Cueto et al. 1231). However, the number has decreased in the past few years as employment rates increased with more than half a million people securing new jobs.
At the time when Spain experienced the highest unemployment rates, between 2007 and 2013, the percentage of unemployed youths stood at 55 percent. The incidence was considerably high among European nations and the second highest after Greece. At the time, one in every Spaniard between age 18 and 29 were not getting any employment, training or education, which was among the highest in the developed world (García-Cintado et al. 247). Currently, as García-Cintado et al. further contend, more than a million Spaniards under the age of 30 are unemployed, and thousands are witnessing as long-term unemployed or without a job for more than a year. Spanish economy may not be under the same effects of the global recession, and the number of jobless in the population has reduced in the past few years. Piketty has explored how a country’s economy must function if any real positive results are to be noticed; he argues that if wealth concentrates in a small portion of the population, it is easier for the small group to grow their fortunes (141). The situation, as it currently stands in Spain allows for a small portion of citizens to gather wealth while others are experiencing economic strains. It is too early to notice any real changes that are brought by concentrated wealth; time is a factor that makes the situation to be more complicated.
Jobs are in short supply and many people living in Spain are likely to be affected by what is referred to economics as the scaring effect. The scaring impact may manifest in Spain if the young workers continue to face a shortage of jobs; it may have more damaging effects if the younger workforce joins the labor market and fail to accomplish what their job prospects and earnings do not meet their expectations. Piketty’s findings indicate that the global economy has not been growing as expected and it is clear that the more people gain wealth; the economy of a country may grow (597). Since there are no jobs in Spain and the rate of unemployment remains high, the economics of Spain will take a long way before it regains its former glory before the most recent global recession.
In response to the high unemployment rates in Spain, job creation strategies were implemented starting from 2014. The current situation in the country reveals that the process is too slow to resolve the many needs of the country’s economy. If the process is not adjusted to bring change as soon as possible, it will take longer for the nation to regain ...