Carnival Cadiz delights in the dole

ALONG with the distinction of being the oldest city in Europe, Cadiz is best known for two things: its famous carnival and its chronic unemployment.

Both were on vivid display recently as a group performing under the name of I'll Start Monday belted out a satirical song.

A crowd, drinks in hand, cheered as the musicians sang of an angel on the singer's shoulder telling him to "grow up" and get a job; while a devil on the other insisted "Why bother? Go have fun".

The song encapsulates the situation here in Cadiz, on the coast of southern Spain just north of Gibraltar. Following the collapse of the property bubble, unemployment has spiralled to 19 per cent in Spain, the highest in the Eurozone, and here in Cadiz it is at a staggering 29 per cent – having been in double digits for decades.

To some, the cultural acceptance of unemployment is part of the problem. "For most people here, being unemployed and – while it lasts – living off state benefits is perfectly natural," said David Pantoja, 36, an out-of-work carpenter who founded an association for the unemployed in Cadiz. "It's just a fact of life, like love or death."

Elsewhere in Europe, such high numbers might prompt social unrest.

Not so in Cadiz. Here life remains puzzlingly comfortable behind the dramatic figures, thanks to a complex safety net in which the underground economy, family support and government subsidies ensure a relatively high quality of life.

"This is a place where you can live well, even when unemployed," said Pilar Castieira, 30. "Life is four days long," she added, recounting a Spanish saying. "On one you're born, on another you die, and in the two in between, you have to have fun."

Over lunch in a restaurant with a view of the port, Miguel Cervera Garca, a grizzled 47, explains how he has picked olives and worked as a plumber – but never officially. "I've always worked, but without a contract," he said amiably. He added that jobs with contracts were better, "since you get social security and paid sick days".

Payroll taxes and unemployment benefits are high in Spain, and many people avoid them by hiring workers under the table or by offering them temporary contracts that avoid the high costs of hiring and firing. Tax fraud has grown during the economic crisis, to the point where many experts see it as the biggest reason why high unemployment has not translated into mass protests.

Officials estimate that Spain's underground economy equals at least 20 per cent of the official economy. In Andalusia it is believed to be higher – how else would one third of the 170,000 registered unemployed survive without claiming state subsidies?

Families remain a strong support network. Home ownership is highly valued, and even out-of-work Spaniards often live on the cheap in homes their families paid off long ago.

Officials support Prime Minister Jos Luis Rodrguez Zapatero's approach to the crisis: extending unemployment benefits even as the state deficit is growing.

"We don't think that people will find a job more easily if we remove help," said government official Juan Bouza. "We think the weakest people need help."

For decades Andalusia has had the highest unemployment levels in Spain. The jobless rate here was 13 per cent four years ago, when levels elsewhere in Spain were at a near-historic low.

But there were signs of improvement. In early 2008, local politicians made campaign promises to bring full employment to Andalusia. But with the collapse of the housing bubble, that is not looking likely, and joblessness in the region is now at 26 per cent.

History explains some of the problems. During the 36 years of Franco's dictatorship, Andalusia was Spain's breadbasket. After the transition to democracy in the 1970s, the region never fully developed industrially. In recent decades shipbuilding jobs have been lost to Asia. Today, 40 per cent of the area's revenue is drawn from tourism, especially on the popular Mediterranean coast around Malaga.

Cadiz is on the windier Atlantic side. In an office with a stunning ocean view, Bouza spoke of the region as a centrepiece in the government's plan to turn Spain into a hub for renewable energy projects. "This will be the Silicon Valley of renewable energy," he said.

But not everyone is buying it. "They said that, by 2012, Cadiz would be a bedroom community (commuter town] for nearby industrial areas," said Esteban Vias Casais, 58, a retired factory worker who lives on a disability pension. But the city already is one, he added with a wink. "Here, everyone sleeps, and no-one works!"