Oct. 5 (Bloomberg) -- At 10 a.m. on a hot Friday, Antonio Rodriguez Alvarez and his brother, Francisco, sit outside a bar in Ecija, Spain, drinking an anise liquor with water. Unemployed laborers, they visit the job center daily at 9 a.m. in search of work. When there is none, they repair to the bar and worry.
Antonio, 44, is divorced and living with his mother. He split with his wife partly because of constant fights about money and his lack of a job. He now weighs going to France, where he heard there is work picking fruit. His 22-year-old daughter is planning a move to the Canary Islands to work in the tourism industry. He said he doesn’t blame her.
“Young people are leaving this town,” he said. “There’s no hope, no jobs. Days are long. You wake up, it’s the crisis. You go to bed, it’s the crisis. It’s always the same around here.”
While crowds in Madrid and Barcelona take to the streets to protest austerity measures triggered by the European crisis, Spain’s small towns and rural areas are quietly disintegrating. The despair of Ecija, a city of 40,000 in the southern region of Andalusia, is measured in rising divorce rates and fleeing young people. Pride in Spain’s four-decade rise has been replaced with bitterness over the collapse of an economy built on construction and real-estate speculation that has left wreckage deep in the Spanish heartland.
“Spain’s economic miracle was science fiction,” said Javier Madero Garfias, 67, an architect who has designed hundreds of Ecija’s buildings since 1973. “I don’t think we’ll ever go back to what we used to be. This is the first time the kids are worse off than their parents in Spain.”
Spain is in its second recession since 2009 and its economy is predicted to contract 1.3 percent in 2013. Industrial output has declined for 12 consecutive months. On Sept. 27, the government revealed its fifth austerity package in nine months that includes 13 billion euros ($16.9 billion) in tax increases and budget cuts. The government has already reduced unemployment benefits and civil servant salaries while raising sales taxes.
In Ecija, the unemployment rate has soared to 30 percent after mattress and furniture factories that supplied the housing industry closed, said Juan Wic Moral, mayor from 2003 to 2011.
“Four years ago we wanted to build a 3 million-euro public swimming pool, a new town hall and three new bridges,” Wic said. “These days we’re talking about a new soup kitchen.”
Ecija is a town of white-washed homes in a maze of narrow, winding streets that date to the Roman era. Its culture is also centuries old, from the horse breeding that began in the region 600 years ago to the 11 Baroque church towers that mark the skyline.
Rural Spain, the land of Don Quixote and El Cid, has long been romanticized by politicians and in popular culture. Andalusia is particularly celebrated, with its traditions of bull fighting and flamenco dancing regarded as uniquely Spanish.
During the boom years between 2000 and 2006, Ecija thrived. Employment grew as factories built home fixtures and furnishings. Madero, the architect, added as many as 10 freelancers to his permanent staff of five to keep up with his building projects. Construction and real estate “acted as a vacuum cleaner,” sucking up all the local capital and talent, said Fernando Fernandez, an economist at IE Business School in Madrid.
When the boom ended, Ecija had nothing to fall back on. Spain went from building 60,000 houses a month in 2006 to fewer than 5,000 a month this year. In 2004, Madero’s firm designed buildings that contained between 500 and 600 apartments. This year, he expects just 25 units will be built. His firm has shrunk to three employees: Madero, his daughter and his son-in-law. He fired his own brother.
“I never imagined construction would end so abruptly,” Madero said. “One day the phone stopped ringing.”
Called “the frying pan of Andalusia,” Ecija often records Spain’s hottest temperatures. In August, when the thermometer reaches 44 degrees Celsius (111 Fahrenheit), the city’s streets are empty for much of the day, as residents with the means escape to the beach or retreat into air-conditioned homes.
At a bar devoted to Ecija Balompie, the town’s third division football team, they still talk about the time in 2006 when David Beckham’s Real Madrid team played the locals, and came in for drinks after. Both the team and the town haven’t been the same. Business at the bar has fallen 50 percent in two years, said the owner, Antonio Lopez.
“Factory workers used to come after their shift,” Lopez said. Since the plants closed “there are no customers.”
When he was mayor, Wic had ambitious plans for Ecija. He envisioned building on its manufacturing base by adding jobs in renewable energy. He said he hoped the city’s population would grow by as much as 50 percent to 60,000.
“The best times for Ecija were the Roman Empire, the 18th century and five years ago,” Wic said. “I don’t think we’ll ever go back to that kind of richness.”
Wic lost his re-election bid last year when his party was swept out of office across Andalusia. Now he works as a school administrator, and has seen his pay cut along with other civil servants. This year, he makes 1,800 euros ($2,339) a month after taxes, down from 2,200 last year, he said.
“I’ll be buying one shirt this year instead of five and I won’t be fixing my car,” he said.
As the economy collapses, the city has become obsessed with once arcane concepts such as Spanish debt yields, Wic said.
“Even the taxi drivers are talking about bond yields,” he said.
Short and bearded, Madero, the architect, drives around Ecija’s narrow streets in his Mini Cooper. He points out the buildings he’s designed over 40 years: a donut-shaped apartment complex, a downtown plaza, private homes tucked behind imposing walls, a 40-bed hospital. A new project for two buildings with 56 apartments has been stalled because banks won’t make loans for mortgages, Madero said.
As he drives down Calle de Santa Cruz, once a busy shopping street, he notes that more than a dozen stores have closed.
“Calle de Santa Cruz makes me want to cry,” he said.
Madero was born in 1945 to a well-connected Ecija lawyer. After attending university in Seville, Madero opened his architecture firm in 1973, just as Spain was shaking off the rust of the Franco era.
Much of Spain’s growth was built on tourism and construction fueled by cheap credit, Madero said. Madero said he succumbed to that temptation, spending more than he should have on his dream house, which he designed and had built in 2006. The three-story home, in downtown Ecija, incorporates a 12th century city wall, a pool and a room for his collection of 93 singing canaries.
“There was a lot of speculation,” he said. “Banks would encourage you to ask for more. It was always about buying more, moving to a bigger home, buying a new car.”
At the 18th century Our Lady of Santa Maria, where Madero oversaw a renovation, Father Antonio Jesus Rodriguez Baez oversees the city’s catholic churches. Demand for the church’s charity has increased, with families receiving aid in various ways, including meals, clothing and help paying utilities.
Families also need counseling as the strain of unemployment frays marriages and divorces increase, Rodriguez said.
In 2004, there were 60 weddings in Ecija’s churches, Rodriguez said. This year there will be 22, as couples delay marriages they can’t afford, he said.
“We’ve booked 12 weddings for next year and I don’t think we’ll make it to 20,” Rodriguez said.
The crisis has been particularly hard for Ecija’s men, he said, who are accustomed to being providers.
“There are men who ask their wives to come to church and ask for help because they feel ashamed of not being able to provide for their family,” Rodriguez said. “Women sometimes come by themselves asking for help without their husbands knowing.”
Agustin Nunez Heredia is a former construction worker who said his marriage is strained because he’s without work. Nunez, 31, left school at 16 to work in the construction industry, and helped build a mall that opened outside Ecija in 2008. Dropping out of school was an easy decision, he said.
“Back then, the money was too good,” he said, standing outside the city’s unemployment office. “A lot of my friends dropped out too. I’ve seen law school dropouts working in construction.”
Working more than 200 hours a month, sometimes until 3 a.m. Nunez went from making as much as 2,800 euros a month to living on 420 euros in monthly unemployment insurance. He never felt his pay was too good to be true.
“I worked hard for it,” Nunez said. “This wasn’t some gift from heaven. I worked hard to make a decent living for my family.”
Back outside the bar, Rodriguez Alvarez, the divorced, unemployed laborer drinking on a Friday morning, remembers Ecija’s more cheerful past.
“Five years ago, this was a happier town and people smiled more,” he said. “People would go out, bars were always packed with people. These days people stay home.”
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