The Path to Labor Stability for Young Spanish Workers during the Great Recession

The Great Recession (2008-2013) worsened the labor market position of young Spaniards. despite governments launched labor market reforms in 2010 y 2012 to improve labor stability, permanent employment accounted for only 10 percent of total new contracts. This paper tries to disentangle which factors are hindering the promotion of open-ended contracts to stabilize Spanish young workers into permanent employment. These analysis use panel data from the MCVL (Muestra Continua de Vidas Laborales). The results indicate that, although having an open-ended contract increases the probability of being employed after two years, only 50 percent of these initial contracts survive. The structure of labor demand explains this instability.