Searcher

Published on Wednesday, September 29, 2021

Spain | Getting to grips with the minimum wage and regional differences

The empirical evidence on the minimum wage provokes a heated debate on its increases and the need to differentiate it according to age and work experience, or region.

Key points

  • Key points:
  • This debate ought to consider other objectives at least as important as that of reaching 60% of the average wage that the European Social Charter recommends. These involve reducing unemployment, temporary employment and the hidden economy to a minimum, while at the same time maximizing productivity, the employability of younger and older workers, and increasing equity.
  • The regional differences in workers' qualifications and business productivity and competitiveness leads to huge differences in the matching of workers with the jobs available.
  • Those regions where a high percentage of these matches involve low-productivity workers, run a greater risk of the same minimum wage for all of them leading to a higher unemployment rate.
  • The best-case scenario would see the regions converge in human capital and business productivity and competitiveness. The problem is that this convergence between autonomous communities has been practically non-existent in the last four decades.
  • We should not give up on introducing a wide range of comprehensive policies, which are coherent and efficient — guaranteeing equality of opportunity between the regions and facilitating their long-term convergence without condemning some of them to a higher structural unemployment rate than others.

Documents to download

Geographies

Topics

New comment

Be the first to add a comment.

Load more

You may also be interested in