Spaniards who grew up in boom years now set their goals low

MADRID — The son of two teachers, Moises Leon got an education degree in hope of joining the ranks of the comfortable middle class that his parents worked all their lives to raise him in.

But his graduation coincided with Europe’s debt crisis, and Spain’s spending cuts have put a teaching job out of reach. So he works two part-time jobs, as a day-care assistant and a private English teacher, that together earn him barely $1,000 a month.

At 28, he still lives with his parents. So do his siblings, both in their 30s.

The younger Leons are struggling to become mileuristas, a slang term in Spain for those who earn a mil (1,000) euros a month, or about $1,300, for a yearly income just shy of $16,000. The term used to be a pejorative, but in Europe’s new age of diminished expectations, it’s become a goal to shoot for.

“When the country used to earn a lot of money, people would say, ‘Oh, you’re just a mileurista. You don’t have a really good job,’” Leon said on a recent afternoon in the Puerta del Sol, Madrid’s central square, as he waited for a young English-language student. “But now, things have changed. And if you earn 1,000 euros per month? Wow, I wish!”

Spain is notorious for having the highest unemployment rate in Europe, nearly 25% among all workers and 39% among Leon’s peers in the under-30 crowd. Last month, the government approved sweeping labor rule changes, offering incentives to small companies to hire unemployed people and allowing them, more controversially, to opt out of collective bargaining agreements.

Although those measures are aimed at tamping down the unemployment rate, they do little for the working poor. A third of all labor contracts in Spain are for two-year temp jobs, with low pay and few benefits. The vast majority of those are filled by graduates younger than 30 who feel lucky to land any job at all.

“It’s like, ‘You can’t complain! You must be happy just to have a job,’” said Miguel Viada, 25, a mileurista who works odd hours at a tech company’s help desk, even though he has a master’s degree. “Maybe it’s not a good job, but you must smile and say, ‘Hey, I’m a lucky guy.’ But no, I don’t think I am.”

Unlike Leon, who lives with his parents rent-free, Viada pays about $300 a month for a room in an 800-square-foot apartment he shares with four roommates, three of whom recently lost their jobs. They split the utilities, but Viada and the other employed roommate buy the groceries.

“It’s the least I can do,” he said, shrugging. But he acknowledged that his bank account often goes into overdraft by the end of the month.

In Spain, a mileurista lives just above the poverty line for a single wage-earner and just below it if he or she is supporting a family of four. A majority of Spaniards reported income of less than $24,000 last year; 80% earned less than $40,000.

What was once considered low pay during Spain’s construction boom a few years ago has now become the norm. Wages have fallen compared with the cost of living. Economists say the trend will continue as Spain struggles to turn around its shrinking economy, a process that’s likely to take years.

In fact, some experts say wages must fall even further for Spain to have any hope of recovering jobs.

“Our problem is that wages should have been reduced right from the beginning of the crisis, so that the adjustment of the labor market to the crisis would have come in terms of lower wages,” said Juan Jose Toribio, a professor of economics at Spain’s IESE Business School. “But we didn’t do that. So all of the adjustment came through unemployment. Now unemployment is so high that we have come to the conclusion that it’s time to reduce wage costs. It’s the only way.”

The new reality of low pay in Spain comes as a blow to young people such as Leon and Viada, who grew up in the boom years and hoped the crisis would be temporary. They’re reaching the point in their lives at which they crave financial independence, to perhaps buy a house or get married and start a family. Those prospects are moving further into a fuzzy future.

Leon remembers the boom years, but older Spaniards’ memories go back further. Thirty years ago, Spain was still a poor country compared with the nations of Northern Europe. It had just emerged from nearly 40 years of military dictatorship, with a closed economy, and wages were much lower than today’s.

“Life will definitely be more difficult in the coming years, and I don’t know yet how difficult it will be,” said Toribio, the economist. “But let’s remember we’re still a developed nation. We’re going through an economic stagnation, but at a level that’s still relatively high.

“I can remember when my salary, with a PhD in economics, was less than a mileurista,” he said with a flash of humor. “So I think they’ll survive.”

Frayer is a special correspondent.