Why a Cádiz town is Spain’s unemployment capital

Benalup stands out even in a province where joblessness is a chronic problem

There are a number of odd things about Benalup, a small town occupied by 7,183 souls in Cádiz province. For one, high season at its main hotel, the Fair Play, is not in summer but in November and spring, when it seeks to draw golf lovers. There is also something odd about its unemployment figures. There are more men than women on the dole, and most of the people on the unemployment rolls were added in the last six months, bucking the general trend in Cádiz province. And in a final twist, local leaders say the high jobless rate registered in October is a result of their efficient aid programs and training workshops.

Benalup has just undergone a historical government change. Francisco González Cabaña, mayor of the town for the last 28 years, gave up his seat to run for Congress in Sunday's general elections. "There is a lot of seasonal work here," he explains. "We can go from 1,400 to 1,100 jobless people from one month to the next."

González Cabaña is the first person to admit that the jobless rate in his village is unreal. "There are 500 applicants in the services sector, when there is nothing like such an offer in services here," he notes. "What's happening is that we had lots of back-to-work training courses and to sign up for them you have to also sign up with the Andalusian Employment Services." Meanwhile, access to economic aid is also contributing to the higher figures. "The [aid] is meant for people in financial difficulties, but they need to be on the unemployment rolls to be eligible, and that's driving the statistics up."

Of the 1,504 jobless people in Benalup in October, 809 were men. This is in contrast with Cádiz province as a whole, where there are more women than men out of a job. It is also noteworthy that so many job applicants filed their forms so recently. Around 33 percent have been on the jobless list less than three months, and 21.3 percent no more than six months. Only 28.3 percent have been on the list for over a year, compared with 42 percent for Cádiz as a whole.

The key to unemployment in Benalup was the construction bust - 35 percent of the unemployed population worked in that area. One of them is Tomás García, 51. "We don't know where to turn. I'm ready to go be a farmer, but it's not like there's too much work there, either." The largest official group of jobless people comprises those who say they work in the services sector, but the mayor calls this "unreal unemployment." They are essentially people with training in the hospitality sector who never actually worked in that capacity. The town stands out for its large hotel complex Fair Play Golf, a luxury resort with all services included. There is another large hotel in downtown Benalup, the Utopía, built in a style that harks back to the 1920s and 30s.

"They hired a few people, but it doesn't help that much. It's still better than nothing," says Miguel Ángel Grimaldi, 27, a wall painter. The real problem here and in nearby towns is the lack of job offers. Last year only 167 contracts were signed compared with 36,000 for the province as a whole.

Unemployed men pass the time of day in Benalup's square.
Unemployed men pass the time of day in Benalup's square.EDUARDO RUIZ

Oñati, Basque miracle town

Oñati, in Gipuzkoa province, is one of the towns with over 10,000 residents that posts the lowest jobless rate in Spain. This mountain oasis with 10,756 residents in the Basque heartland combines an entrepreneurial class that is committed to the cooperative work model, workers who are equally committed to their companies, a higher education center (the University of Mondragon) with direct links to the private sector, and local administrators who help make this system work effectively.

So far, Oñati has managed to avoid the most devastating effects of the economic crisis thanks to a solid foundation built over the course of years and to the efforts of all the players in the cooperatives. As a result, its tranquil streets are filled with seniors strolling with their grandchildren and women out with their babies. There is not one jobless person in sight. After an hour's search, this reporter even found a Brazilian teacher here on an exchange program, but no sign of the 315 individuals on the unemployment rolls, who make up 5.4 percent of the working population.

There are large companies located near here, such as the home appliance maker Fagor and the chocolate factory Zahor. Students at Mondragon University are assured a spot at one of its partner companies, including the powerful Grupo Mondragon, owner of, among other things, the Eroski supermarket chain.

"Our highest unemployment level was 485 people in 2009," explains the new mayor of Oñati, Mikel Biain of Bildu, the radical coalition controlled by Batasuna (ETA's former political wing) that was allowed to run in municipal elections earlier this year. "The cooperative formula works - it's a way to share out wealth more equitably with a system that's been developed over the years," he adds.

The people in between jobs here are typically unqualified workers - a rare thing in a town with such a high proportion of residents who have been through higher education - and immigrants, who number 536.

"Two-thirds of the jobs are to be found in the cooperatives, where there is no such thing as layoffs, just relocation in another company within the same group," says the former mayor, Lourdes Idoiaga of the conservative Basque Nationalist Party (PNV).

Yet the crisis is being felt. In boom times, workers get a share of the profits, whereas now they are being asked to make personal sacrifices such as pay cuts. And there are lots of temporary workers.

The dean of the Business School at Mondragon University, Lander Beloki, explains that businesses with delegations in countries with strong economies are doing better. Many keep their headquarters in Oñati out of personal conviction.

The challenge now is "to return to the valley's roots," says Aitor Lizartza, an instructor in entrepreneurship and innovation at the local university. "We need to transform society once again through an economic revolution." For now, he and other educators are showing first-year students how to create companies and grow them over the course of four years with real clients, real investors and real money.

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