There will be more to come

There is no doubt that labour laws in Spain needed to be reformed. On the one hand, public service employees enjoyed a privileged position; their unions had negotiated unprecedented protection levels for them. On the other hand though, the rest of the workers in the country had little or no protection at all. Most affected were young workers in the market for the first time who would find themselves in and out of work at the drop of a hat.

It was sensible to make changes and try to close the gap between the two sectors by reducing the privilege for the public sector workers and at the same time increasing job security and rights for the rest. Inevitably though, the privileged have lost too much and the less privileged have gained very little. The only winners in all this are the employers because they have used the changes in the law to make savings. In Andalucía, for example,  there have already been 8 times the number of dismissals than there were last year. Workers are faced with either a cut in pay or dismissal.

Unfortunately, the northern European strategy of austerity has left the government in Spain with very few options. The labour reforms were touted as a means to promote growth. Understandably, workers do not see it that way. The massive cuts the government  have made and will continue to make will far outweigh the benefits of labour reforms and will I fear strangle growth - effectively negating any benefits the country gains from the reforms. 

Today's budget will only add to the pain that many Spaniards feel as they see their living standards worsen. The general strike yesterday may only be the tip of the iceberg.

NB For the benefit of my Spanish readers, the title refers to a saying which English people use when there are no options to choose from. It refers to one Thomas Hobson who had an extensive stable of some 40 horses which he used to rent out. This gave the appearance to his customers of having their choice of mounts when in fact there was only one: Hobson required his customers to choose the horse in the stall closest to the door. This was to prevent the best horses always being chosen, which would have caused those horses to become overused.