Labour market reforms in Spain and its impact on labour market flexibility

This thesis deals with the labour market reforms in Spain that were adopted in order to increase the labour market flexibility and decrease the extraordinarily high unemployment persisting in Spain over decades. The thesis focuses especially on the latest labour market reform adopted in February 2012, which is considered the most impactful one, especially regarding dismissals and their cost. After introducing the main characteristics of the Spanish labour market including, among others the historical circumstances that have led to the current situation, an analysis of several labour market indicators is performed, aiming to find out whether the objectives of the 2012 reform were fulfilled or not. Furthermore, the thesis investigates the performance of the German Hartz reforms adopted in 2003-2005 and attempts to quantify the cost of potential application of their measures on the current Spanish labour market situation. This provides a valuable insight useful for the proposal of recommendations to improve the Spanish labour market