While the United States has seen
relative growth as of recently, there are many countries, especially in the
European Union, that are getting destroyed by the Euro crisis. Spain is
one of the countries topping the list of struggling economies.
BBC UK reports the final quarter of
2011 marked 5.3 million unemployed Spaniards, a growth from 4.9 million in
quarter 3 of 2011. This number is especially scary, as 5.3 million
accounts for a 22.8% unemployment rate, more than double the average
unemployment rate in the eurozone. With such a high unemployment rate,
the Spanish government is desperately trying to find ways to cut the budget and
raise taxes in the upcoming year, but will expect a 1.5% shrink in the economy.
The
Spanish Unemployment Rate Dating Back to Around 2005. Since the housing
bubble in 2008, Spain has struggled with job growth.
With
the unstable European economy as it stands, something has to be initiated to
regain investor trust into eurozone countries. The European Union (and
the global economy) will find it near impossible to bail out Spain, and a
default would be extremely damaging to the global economy.
If we
were to see a 22.8% unemployment rate in the United States, there would likely
be riots through every city across the country. The citizens who are
taking the hardest hit in the Spanish economy are the youth. BBC reports
that there is a 48.6% unemployment rate for the ages 18-24. This is
extremely troublesome, as the best hope to build the economy is going to be
with new blood and different economic thought to promote growth.
With
Spain’s unemployment rate, I wonder what effect on emigration within the EU
will happen over the next year. What I could imagine occurring would be
many of the young adults moving to countries with more attractive positions
available. This is not an uncommon notion, especially with the ability to
travel between EU countries relatively easy.
Over
the last year or two, there have been articles discussing the emigration of
Irish after the bail out. Ireland has experienced two waves within the
last 20 years of young adults becoming educated in Ireland, then finding
positions in other countries around Europe. Once the economy begins to
pick up in Ireland, many attempts to move back, and as the trend has shown, are
able to find jobs and send the economy into a spurt of growth.
Perhaps
Spain will experience a similar movement. While Spain has a much larger
population than Ireland, the incentive to find work remains the same. I
have never been to Spain, and while I wouldn’t necessarily know the social
norms to leaving the country, citizens or the Spanish government need to make
an effort to save the economy.
References:
- “Spain’s Unemployment Total Passes Five Million”. BBC UK. http://www.bbc.co.uk/news/world-16754600
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