Spain's Jobs Miracle Is Under Threat
Spain’s socialists want to take its labor market back to the pre-crisis era. This would be a big mistake for one of Europe's best-performing economies.
Jobs question.
Photographer: MIGUEL RIOPA/AFPThe euro zone’s response to the sovereign debt crisis is usually associated with austerity. Yet some member nations have forged their own path: Spain and Portugal, for example, overhauled their labor and product markets, helping them return to growth.
Now, these structural reforms are under threat in Madrid, as a left-wing coalition of the Socialist Party and Podemos wants to take the country’s labor market back to the pre-crisis era. The minority government of Prime Minister Pedro Sanchez is having to rely on a bunch of regional parties to pass legislation, so it’s possible it will lack the votes to make significant changes. Nonetheless, it’s worrying that Spain wants to row back on measures that have made it outperform the rest of the single-currency area.