Spain is, like many of the countries on the European periphery, struggling under an unhealthy sovereign debt burden while facing several other macroeconomic problems. The crisis, which has only gotten worse for Spain since the initial recession in 2008, has left much of the nation’s youth unemployed. Over reliance on the construction sector, a factor in other European collapses, has left many of the young people of the country with a limited skill set. Emigration seems the only option for most of the unemployed population as they face the choice of leaving or awaiting a recover that could be many years into the future.
Earlier today we asked whether or not the United States should encourage its young people to emigrate to find work rather than continue their unemployment inside the country. An institution of a strategy like that would slightly reduce the unemployment costs for the United States but would not significantly improve the macroeconomic outlook to any degree.
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Spain’s unemployed population is different and the problem requires separate analysis. The country’s entire population is just over 45 million, less than a sixth of the United States. The country faces unemployment far above that of the United States, north of 23%. The preponderance of the construction industry in the time before the crash means much of the unemployed are specialized in the same sector. A drastic change is needed.
Emigration is a much better strategy for Spain for a multitude of reasons. The first of these is the simple fact that it is easier. Free movement of people inside the European Union makes emigration easy and cheap within the trade bloc. Though the entire region is under performing, certain skills are required in other countries that are not needed in Spain.
The second is the sector specificity of unemployment in the country. Because of the concentration on construction jobs it is almost impossible for any great number of these workers to regain positions like those they held before the crisis. For these only two options are available, retraining or emigration.
The third is the huge sovereign debt problems in Spain, mirroring Greece, Ireland and Portugal’s problems. Any alleviation of the government’s spending will be accepted as a move in the right direction
Spain may well reap dividends by encouraging its young people to emigrate. It is in an entirely different situation than the United States. Mass emigration is a bane on any society. The exodus of people, particular the young, is a blow but history shows that countries recover and thrive after such movement.