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Spain steps up jobless fight

Spain steps up jobless fight
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Spain’s cabinet has approved further moves to try and reduced unemployment rates that are the highest in Europe.

They include labour law changes giving more flexibility to employers to hire and fire workers as the government is keen to end a big rise in temporary job contracts.

Severance pay when people are laid off is to be reduced and wage rises delinked from inflation.

These measures go further than a recent agreement between unions and employers organisations and angered the left.

Lawmaker Alberto Garzón with the left-wing coalition party La Izquierda Plural said: “This is a strategy to dismantle what remains of the welfare state, to follow the British model and so give new business opportunities to private capital — that is big business, the super rich and the big banks. “

Prime Minister Mariano Rajoy recently acknowledged that the jobless figures will not improve this year.

Spain’s unemployment rate is expected to continue rising from almost 23 percent last year and, according to economists at BBVA, will hover around the 24.5 percent mark this year and next year.

Unemployment among young Spaniards is close to 50 percent.

The legislation marks the latest stage in a concerted campaign by Madrid to persuade financial markets that it can slash its public deficit and remove structural weaknesses in the economy.

With Spain heading into recession for the second time in three years, job creation is still a long way off and the changes are not expected have an immediate effect.