Awake,for morning in the bowl of night has flung the stone that puts the stars to flight.

And, lo, has caught the sultan’s turret in a noose of light!

Spanish life is not always likeable but it is compellingly loveable: Christopher Howse: ‘A Pilgrim in Spain’

Cosas de España

Productivity is one measure of the efficiency and competitiveness of a nation’s economy. And it seems that, in Spain, things aren’t going too well in the that department. Even worse than the UK, perhaps. This is the article in El Español where reasons for this are to be found.

There’s an article here in Spanish, a (machine) translation of which can be found below.

The only thing I know about nuns in Spain is that you can’t be one if you’re taller than 150cm, or 5 feet. Or so it seems to me. So, this was news to me. I think we have 2 or 3 of the blue-habited nuns in Pv city. Where sister Lucía saw JC a few decades ago, both in the chapel and down by the contenadores.

Spain is to favour foreigners by offering them a non-binary gender option on their residency cards – something not available to the locals. Lucky us. I might give it a try.

The UK

The estimable Effie Deans posts here a pungent indictment of Nicola Sturgeon, the ex First Minster of Scotland. There comes a point, Effie says,when history views a blank slate and sees a concerted attempt to destroy the historical record as itself evidence. Of what?, you might ask. Well, only The worst scandal in Scottish history. When, it seems, most Scots and all English politicians were comprehensively gulled by Ms Sturgeon and her husband. But we can’t be sure, coz – says Effie – she’s destroyed all the evidence. Which is surely convenient, if nothing else. Even The Clown Boris didn’t do that.

Sometimes you wonder if the UK isn’t too free/liberal. Especially when it comes to pandering to religious minorities. This is one reason why. Taster: Islamic assaults on secular teaching generally end in capitulation. Why show the door to Christian fanatics but leave it open to Islamic fanatics? Has nothing been learnt in 200 years. Or are the lessons ignored out of fear of being a liberal accused of Islamophobia?

On more important matters . . . I’ve mentioned the prices for wines in pubs, usually offered in 3 sizes – 125ml, 175ml and 250ml. At midday today, after dropping my granddaughter off at her dance class, I repaired to a nearby cafe-bar that was at least as welcoming as any in Spain. And humming. Which probably explained the long wait at the bar. But not the prices . .  A small glass of inferior Verdejo* set me back GBP5.10 – or €5.92. So the bar income is almost GBP31, or €35** a bottle. But at least it keeps down the mortality rate on the roads, I guess.

• * Puntuación of only 3.1/5.0
• ** Prices in Spain start at around €3.10 a bottle. [Sic]

Germany

Spain is clearly not the only problem with economic woes. What’s Gone Wrong with Germany?, asks this columnist.

France

Mon dieu! Having taken the right decision on nuclear power years ago, France is now coining it at the expense of the whiter-than-NZ-white UK.

English

This is a list of words that don’t exist in English but possibly should. Who’d have thought that the vast vocabulary of the bastard language that is English could be expanded by the manipulation of random syllables?

Did you know? . . .

A key part of writing is editing your drafts, first to reduce the text wherever you can and secondly to correct typos. Ironically, it’s at at this stage when you’re likely – well, I am – to make more mistakes by, eg, leaving in the wrong word(s) alongside the right one(s). I crave indulgence.

BTW . . . The links-creation problem that email subscribers suffered yesterday was down to WordPress, not me. I managed to install the links for later readers.

Finally . . .

As some readers know, I’m in the UK for quite some time as my younger daughter is in hospital in South Manchester. And her husband today had a heart operation to correct a faulty mitral valve. So, I’m minding the young grandkids for around the next 10 days. Which rather knocks my aim of getting a blog post out by midday. So, apologies for those readers who’d like to get them earlier.

The Usual Links . . .

You can get my posts by email as soon as they’re published. With the added bonus that they’ll contain the typos I’ll discover later. I believe there’s a box for this at the bottom of each post. I guess it’s logical that this doesn’t appear on the version given to me . . .

For new readers:– If you’ve landed here looking for info on Galicia or Pontevedra, try here. If you’re passing through Pontevedra on the Camino, you’ll find a guide to the city there – updated a bit in early July 2023.

For those thinking of moving to Spain:- This is an extremely comprehensive and accurate guide to the challenge, written by a Brit who lives in both the North and the South and who’s very involved in helping Camino walkers.

Productivity in Spain has fallen by 7.3% in 20 years, although it has accumulated a rise of 2.8% after the pandemic.

Between 2000 and 2022, Spain accumulated a 7.3% reduction in productivity. The fall is even more surprising when compared with other countries such as the United States or Germany, where in the same period this indicator rose by 15.5% and 11.8%, respectively.

The accumulated fall is evidence of “a deficient use of the resources used” and places Spain in a position of “disadvantage” with respect to the productivity of other countries. “A part of its productive system is not efficient, holding back cost advantages when competing and improvements in per capita income and welfare,” explains the first report of the Observatory of Productivity and Competitiveness in Spain (OPCE).

The OPCE study, created by the BBVA Foundation and the Valencian Institute of Economic Research (IVIE), also notes a change in trend in terms of productivity in recent years, despite the setback of the last two decades.

Thus, between 2013 and 2019, after the Great Recession, total factor productivity (TFP) rebounded by 1.2%. However, with the outbreak of the pandemic, in 2020, it fell by 5.1%, only to grow again between 201 and 2022. Each year saw a rebound of 1.4%, giving a cumulative total of 2.8% over two years, reflecting a faster recovery than in previous crises, according to the OPCE.

This growth is insufficient to compensate for the decline of previous decades and also to match the figures for the European Union (EU). The main reason is “an unfavorable evolution of the productivity of labor and capital in Spain”.

[How companies can tackle that productivity issue].

In the case of labor productivity, understood as the result of dividing GDP by the total hours worked by the employed, it has grown less than in other countries. The annual average is 0.7% since 2000, slightly below the 1.1% of the EU as a whole and the 1.4% of the United States, as noted in the first OPCE report.

As for capital productivity, the value added generated per unit of available endowments, its average decline in Spain has been 1.2% per year between 2000 and 2022. The OPCE explains that this is due to the fact that “accumulated investment has advanced more than the value added generated”. Between 2020 and 2022, it grew by 2.8%, but this was insufficient “to converge to average European productivity levels”.

Weak growth

This report, led by IVIE researchers Francisco Pérez, Matilde Mas, Dirk Pilat and Juan Fernández de Guevara, together with economists Eva Benages, Juan Carlos Robledo and Laura Hernández, also from the IVIE, investigates the causes of the country’s low productivity levels.

The first is “because the trajectory of total factor productivity maintains productive efficiency levels below those of the last century”. Thus, while in the last 30 years Spain has accumulated physical and human capital, productive efficiency is below that recorded in the 20th century. With this increase in physical and human capital, Spanish GDP has grown, but less than it would have done if the aforementioned factors had been taken advantage of.

The second reason for this weak growth pattern is the “excessive accumulation of real estate assets – residential and non-residential”. We have to go back to the years of the real estate boom, although some companies are still using them today. The problem is that they do so only partially, and they are a drag on productivity.

For the authors of the study, there is a third factor. Investment in assets that should help boost productivity, such as ICTs and intangibles, has not done so to the extent it should and has advanced at a slower pace than in other economies.

Labor productivity

In the midst of the debate on working hours and productivity, the OPCE report notes that advances in labor productivity “are modest” in these first decades. This is despite the increase in investment per worker.

There is no single cause to explain the “slow progress” in productivity per hour worked, which barely grew by 0.7% in the period analyzed in the study. The main reasons point to “poor educational results” and the temporary nature of the Spanish labor market. Both factors “limit the productive potential of the accumulated human capital”.

Together with this, the Spanish labor market is less intensive in human capital than the European one. Thus, Spain has less qualified employment than its environment. The most productive sector in Spain is ICT, with 49.3 euros per hour worked compared to 30.6 euros for the aggregate of the Spanish economy, with data from 2015. However, “its weight in Spain is very small, representing only 5% of GDP and 3% of employment”.

The reasons for low productivity per hour worked also point to the companies’ management models. This problem is more present in smaller ones, where the person in charge “in many cases does not have higher training.”

[The Bank of Spain fears that reducing the working day to 37.5 hours will distance Spain from the average GDP of the EU]

“This lower presence of human capital in the management of an important part of the productive fabric has consequences on the specialization of companies, the qualification of the jobs they offer, the orientation and the use of their investments,” the report states.

The absence of highly qualified profiles in leadership and management positions is also related to low investment in intangibles and the use of human capital.

Little investment

Faced with this excess real estate capacity, in the first two decades of this century, investment in intangible assets, such as R&D, brand image or worker training, has been lower, despite their importance in improving the efficiency of companies. companies.

Spain occupies the last position in investment in intangibles among advanced economies, according to data from the OPCE study. Only 40.5% of the total investment is allocated to these issues, compared to countries such as the United Kingdom, Finland, the United States, France or Sweden, with investments that exceed the data for Spain by 20 percentage points.

Compared to GDP, Spain cannot boast either. Investment in intangible assets was equivalent to 9.5% of GDP in 2020, almost half that of France, Sweden or the United States.

Although Spain continues to lag behind, OPCE researchers also observe a change in trend at this point. The annual growth rate of intangible assets went from 2.6% per year between 2000 to 2013, to 3.9% per year between 2013 and 2019.

Real estate ballast

Spain’s low productivity is the result of past bets, such as the real estate boom, between the first and second decades of this century. The researchers of the study point out that construction, as a provider, and hospitality, energy or services, as demanders of premises and warehouses, “attracted enormous investments that turned out to be unproductive.”For years, Spain invested in brick, and that later led to “excess unused capacity.” That uselessness emerged, evidently, “when the economy entered a recession.”

Between 1995 and 2007, the motivation to invest in residential and other constructions was more “expected short-term capital gains” than the productivity that these capitals could offer in the medium term if they were fully used, as evidenced by the report.

The problem with real estate assets is that “they are very durable” and their waste in these decades implies “amortization and financial costs for the companies or households that own them.”

[The sale gives the ‘sorpasso’ to the rental and is consolidated as the first option after 15 years]

Furthermore, many of these properties and homes are empty or partially used, with higher percentages than in the rest of Europe.

In real estate matters, the OPCE asks to take these data into account “before talking about insufficient residential investment as the cause of current price tensions in some local housing markets.”