1Unemployment in Spain: An Analysis of Labor Mobility and Young Adult Unemployment

In this paper, I investigate the underlying reasons for the high levels of unemployment in Spain. To do so, I compare the labor markets in Spain, the European Union, and the United States to determine which idiosyncratic factors in Spain contribute to the high unemployment level. Then I center my analysis on institutional factors, labor mobility, including geographic labor mobility and the ease with which people transition between unemployment and employment, and young adult unemployment. I conclude that contrary to popular belief, institutional factors are not the main reason for the high unemployment rate in Spain, and in fact, labor mobility has a considerable effect on unemployment. Furthermore, the high unemployment rate for young adults increases the attractiveness of pursuing further schooling rather than entering the labor force, resulting in an overqualified workforce and further increasing the unemployment rate