… at least in some sectors and professions.
After all the turmoil, the size of the Spanish economy will not have significantly reduced. Overall, since its peak in Q42007, there has been a total destruction of 9.4% of GDP. The figure is impressive but the economy is not that badly hurt. It’s just -5.4% since Q42006, before the last leg of the housing/finance boom; and one could argue that it’s the speculative hype that has been wiped out.
I could not resist from expanding a little bit on my previous post due to some recent news on the newspapers. It read: 2 out of 3 young professionals who are currently unemployed have professional aspirations of becoming a public sector employee. In some regions, public sector employment represents over 25% of active population.
Investing several years in preparing for the exams to obtain a job in the public sector is very attractive, popular and more affordable in Spain/Italy/Portugal/Greece than other central/northern countries. Twenty and thirty-something are still living with mum and dad and some of them are unemployed, so the cost of opportunity is significantly lower.
Risk aversion has increased exponentially since the crisis settled in the hearts of the young and old. That again is something that may have a cultural explanation, but part of it may also be of the government educational and labour policies, subsidizing sectors that are not those of the future and cutting budget in R&D, perpetuating the economic structure of the country.
We’ll also see an additional effect caused by the age pyramid structure: there will be more retirees than young entrants in the labour system. This also combines with the thousands of youngsters that drop out of the educational system before choosing going to university or professional education.
All this facts and figures are a symptom of the stagnation of the situation. Young professionals, who should fuel the sectors that should take the country out of the economic black hole where we are, are thinking about security, comfort and zero risk and no professional aspirations.
That is not the solution and most economist still don’t agree with what sectors will take the country out of the recession and put it back on the economic map. The old model is exhausted and the new blood that should take us out of it is distracted.
(Side note: That may be cynically good: If the government does not have a roadmap, then it’s good not to have too much wood on the steamer.)
A side effect may ironically be a new “war for talent”. Even though the quantity of highly qualified positions to be covered will dramatically decrease, so we’ll see a decrease in the number of potential candidates available.
My rationale is that there will be some spaces where salaries will go up and there will be continued demand for highly skilled professionals. The few that hang up on the traditional professional career or that explore consistent professional steps will see a relatively healthy pipeline of opportunities.
The moral of this tale is: keep doing what you do best; keep investing in education, show a consistent career path, try to differentiate from the rest, … and it will pay off; maybe not short-term, but it will in the mid-term. You may be a winner of the new “war for talent”.
