Malaga’s retiring workforce outpaces youth hires, study warns

Malaga province is facing a growing youth unemployment crisis, with more young people under 30 out of work and an ageing workforce that is retiring faster than new workers are coming in, according to recent data and reports.

The Instituto Nacional de Estadística (INE) and a Fundación Adecco study shine a light on a troubling trend: while overall unemployment in Malaga has improved, the region’s youth employment continues to face disproportionately low new hires.

In Q4 2024, the Malaga Province’s overall unemployment rate was 12.76 per cent, with 108,700 people unemployed, a significant reduction of 33,900 from 2023, according to the INE’s figures. However, national trends suggest youth unemployment (ages 18-24) remains stubbornly high. While exact up-to-the-minute statistics are not available, the estimated unemployment rate for the age group 18 to 30 is between 20 and 25 per cent.

More due to retire than are being employed

The Fundación Adecco report shows a looming demographic crisis: over the next decade, Malaga expects 175,600 workers to retire but only 60,226 young people to enter the employment market, which is a ratio of 2.9 retirements per new worker. In the rest of Andalucía, the disparity is even starker, with 854,300 retirements projected against 290,957 new hires, creating a regional ratio of three retirements per new worker. The generational imbalance, is threatening Malaga’s tourism-driven economy, which relies heavily on a steady workforce.

Historical trends show there has been progress but also continuous challenges ahead. Initiatives like the EU’s Youth Guarantee Scheme, implemented effectively in Spain since 2015, and expanded vocational training have reduced the number of “ninis” (youth neither working nor in education) by half since 2015, when over 21 per cent of Malaga’s 18-24-year-olds fell into this category. Vocational training graduates in Malaga nearly doubled from 5,985 in 2012 to 10,445 in 2022, and early school dropout rates fell from 27.7 per cent to 15.9 per cent over the same period.

Andalucía’s youth unemployment remains extremely high at 37 per cent, nearly ten points above the national average, and Malaga’s reliance on seasonal tourism doesn’t do much for job insecurity for young workers. Temporary contracts are very common among young people and are contributing to a sense of economic instability.

The social and economic impacts run deep. High youth unemployment is behind income inequality, with Spain ranking among the EU’s most unequal countries. Prolonged joblessness risks social exclusion, poverty, and, to a certain extent, delinquency among young people, while also diminishing skills and workforce participation. The Adecco report warns that without intervention, Malaga’s economy could face employee shortages and therefore stifle growth in key sectors like hospitality and services.

Legal changes force establishments to reduce opening hours

Recent updates to the working time directive in Spain have compounded problems for small businesses, with popular restaurants dependent on the summer season for the lion’s share of their yearly earnings. Previously, many of these places operated like informal family businesses, with a big rush in the summer in an all-hands-on-deck fashion and a much more flexible, easy-going rest of the year – the monthly pay remaining the same each month. However, a recent crackdown on this practice with more inspections means bars and restaurants have to respect daily working hours more strictly, as though the business model was based on the amount of income being the same each month. Coupled with this, the seeming unwillingness of the region’s young people to get into hospitality has led to establishments having to cut back their opening hours. This was highlighted by chef José Carlos García in Malaga, who scheduled 10 interviews for front-of-house staff but says none of the candidates bothered to show up.

But, are young people just lazy?

The narrative of “laziness” often stems from frustration with systemic issues, as seen in some social media posts blaming youth for lacking ambition or skills. However, these views oversimplify the problem, ignoring structural barriers like labour market rigidity, the cost of living crisis, inadequate employment policies, and an education system not in line with market needs. Young Spaniards, are more often than not, willing to work but are constrained by an economy that offers limited opportunities for stable, rewarding employment in an increasingly expensive society.