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POLITICS

Summer jobs bring Spanish unemployment to six-year low

Spain's jobless rate slipped to 20 percent in the second quarter of 2016, as the tourism boom provided much needed seasonal work.

Summer jobs bring Spanish unemployment to six-year low
Spain's tourism boom creates summer jobs. Photo: AFP

The official figures by Spain’s National Statistics Institute (INE) were published on Thursday revealed the lowest unemployment rate in nearly six years and brought a boost to acting Prime Minister Mariano Rajoy as he struggled to stay in office.

The number of people out of work fell by 216,700 during the three month period of April to June as summer work in the tourism industry swelled the ranks of the employed.

Acting Economy Minister Luis de Guindos said he was confident the figure would drop below 20 percent by the year's end and Spain would have 20 million people employed as planned by 2019, up from 18 million at the moment.

The figures represented the lowest jobless level since the third quarter of 2010 and down from 21 percent in the previous quarter but Spain’s unemployment rate still remains the second-highest in the European Union after Greece.

The youth jobless rate – for those under 25 years of age – remained at a staggering 46 percent.

Spain is enjoying a record year in tourism figures as holidaymakers choose Spain over trouble spots such as Turkey, Egypt and Tunisia.

But although the service sector fuelled employment, many of the jobs were only on short-term contracts.

The UGT union warned in a statement that the new jobs in the second quarter were “temporary, low-quality and low-paid.”

Among the 252,700 salaried jobs created during that time, according to INE, around two-thirds are temporary.

And the second quarter rise in jobs is not as strong as it was at the same time in 2014 and 2015, when more than 400,000 posts were created.

Employment creation remains one of the key concerns for Spaniards as the nation struggles into its eighth month without a government following two inconclusive general elections.

King Felipe VI is holding talks with political party leaders this week in the hope that a compromise can be struck to form a coalition government and avoid a third election.

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PROPERTY

Spain’s plan to limit temporary accommodation rejected

Spain's left-wing government had planned to tighten its grip on temporary accommodation rentals as a potential means of making more long-term rentals available, but the country's right-wing parties on Tuesday rejected the proposal in parliament.

Spain's plan to limit temporary accommodation rejected

If passed, the new law would have meant that anyone who wanted to temporarily rent a property would have to explain why and provide a valid reason.

For example, students or researchers would have to show the research contract or course booking to show it would only last a few months.

It would have also meant that if more than six months passed or more than two consecutive contracts issued, it will have automatically become a long-term habitual residence instead.

On Tuesday September 17th, the proposal was ultimately rejected in the Spanish Congress, voted against by Spain’s three main right-wing parties – Catalan nationalists Junts, Spain’s main opposition party the PP and far-right Vox.

The aim in part was to try and rectify the controversial Housing Law, which came into effect in 2023.

In most people’s eyes, the legislation has failed as landlords have found several loopholes to get around the restrictions, prices have continued to increase and the stock of rental properties is even more diminished.

READ ALSO: Has Spain’s Housing Law completely failed to control rents?

As a result of the fear of heightened regulation for landlords, many have left the traditional market and turned to tourist rentals or temporary accommodation instead, which are far more lucrative. 

This has had the opposite effect, increasing rental prices instead of stabilising or decreasing them.

READ MORE: Why landlords in Spain leave their flats empty rather than rent long-term

Seasonal contracts and room rentals allow landlords to raise prices every six or nine months and they not subject to the price limitations of the housing law.

The idea of this new law was to try and set the maximum duration of a temporary rental contracts at six months in order to avoid this, but it could have potentially also caused problems for many who need this type accommodation such as students, digital nomads, those living here on a short term basis etc. 

During the debate, Sumar’s spokesperson, Íñigo Errejón, defended the law saying that it is a “solvent”, “fair” and “precise” proposal, which will help “correct an abuse” and “close the gap through which “Landlords can use to avoid the LAU (Urban Leasing Law) and rent regulation”.  

Far-left party Podemos blamed the ruling PSOE for having left this “hole” in the housing law, but also agreed that the restrictions on temporary accommodation were needed to try and rectify this.

READ ALSO: Has Spain’s Housing Law completely failed to control rents?

Junts (Catalonia’s main pro-independence party) and the PNV, the Basque nationalist party, were firmly against it. They agreed that the problem must be solved and that “accessible decent housing was needed”, but raised the situation of students, interns, residents or workers who need housing for flexible periods.

Junts party member Marta Madrenas warned of the harmful effects that this limitation on temporary rentals can have for university cities such as Girona.

Vox and the PP meanwhile argued that they don’t want to help cover up the mistakes made by the left with regards to the Housing Law.

Vox deputy Ignacio Hoces stated that the increase in seasonal rentals has occurred due to the “failure” of the Housing Law, since this has caused rental prices to “skyrocketed” by 13 percent and the supply to be reduced by 15 percent.

Temporary accommodation, referred to as alquiler temporal or alquiler de temporada in Spanish, is considered to be anything that’s longer than a month but shorter than a year, middle ground between short-term and long-term rentals. It is also referred to as monthly accommodation or seasonal accommodation.

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