Wednesday, June 29

Extend ERTE | Opinion

Empty terraces in Bilbao.
Empty terraces in Bilbao. Illustrated Service (Automatic) / Europa Press

The pandemic has dealt a severe blow to the Spanish labor market in 2020. Membership has fallen by more than 360,000 people and unemployment has increased by more than 724,000. Thus, the series of six consecutive years of recovery is truncated, which, although with great prominence of precarious, temporary and unproductive employment, had allowed to recover the levels reached before the previous crisis. Unfortunately, the immediate future is not going to be better. Winter is the worst time in the highly seasonal Spanish job market. In addition, and above all, the new expansion of the pandemic suggests difficulties and restrictions that obscure the horizon.

All the available elements therefore indicate that Erie will continue to be necessary for a longer time. Until now, they have been an essential tool to cushion the impact of the virus on companies and workers. Comparison with what happened in previous crises shows it. The usual thing in Spain when recessions arrive has been a much greater decline in employment than in GDP. During the pandemic that perverse relationship has been reversed. This shows that the mechanism is useful and has met its objectives for the moment, despite the fact that it has had management problems (traffic jams in the See and the regional employment services or delays in the collection of some benefits).

The challenge now is to keep it working, even better, in the coming months. On the 31st, the extraordinary regulation that was approved in the fall expires and this same week the Ministries of Labor and Social Security begin to negotiate its extension with the social agents. The heads of both departments —Yolanda Díaz and José Luis Escrivá— have already made it clear that their intention is to renew it for the third time with the adjustments they deem necessary after analyzing its operation. The unions and the employers took advantage of the publication of the labor market data yesterday to demand its extension. Among the employers there is no shortage of sectors —the hoteliers— that are already asking to take it until the end of the year.

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For now, a negotiation that concludes soon, without rushing the deadline to the maximum, would be advisable. Yolanda Díaz herself has spoken of January 15. You have to quickly offer certainty and confidence to companies so that they can make their forecasts. Regarding the time horizon, an extension until the end of the current state of alarm in May seems reasonable. Too short a time would cause undesirable instability; one too long, an illogical tie in a very changing scenario. It will be necessary to reassess the situation in the second quarter, and perhaps then plan a transition with more selective support schemes. It also seems appropriate that measures be contemplated to help those Eriected by Erie not lose their powers and to facilitate their recycling if their employment is subsequently destroyed.

It is true that the prolongation of the mechanism carries the risk of sustaining companies or activities that have little or no future after the virus, the phenomenon known as zombification. But the current circumstances advise that we still continue betting on a strong support for the productive fabric and employment through the different extraordinary moErieties of Erie.

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