The industry contributes to the reduction of inequalities because the jobs it generates have greater added value and, therefore, with higher salaries. When an industrial company closes, workers often end up in the service sector with lower wages. This basic idea defended by economic literature has been endorsed by a study by the Barcelona Institute of Economics (IEB) commissioned by the Business Department, directed by Roger Torrent.
The report has shown that “the loss of relative weight of the industrial sector has translated into an increase in employment in services, especially those with lower qualifications.” This situation caused “an increase in the duality of employment in the labor market between highly qualified and very low-skilled workers, which would be one of the causes of the increase in inequalities.”
The analysis has been done on 31 Local Work Systems (SLT) in Catalonia. They are geographical units, different from regions, created based on labor mobility criteria. The hypothesis is also valid for technology activities, the report says.
The geographical areas where the distribution of income among its inhabitants is more equitable are Igualada, Olot and Guissona. The reason – according to the study – is the high weight of the industrial sector in these areas. Guissona, for example, has an industry weight that is 3.5 times higher than the Catalan average. In that area and in Olot, activity is very focused on the food industry, while in Igualada it is on the textile, clothing and leather sector.
During the presentation of the study, the general director of Industry of the Generalitat, Oriol Alcoba Malaspina, highlighted that this “empirically demonstrates that industry contributes to reducing income inequalities, and that is a benefit for society as a whole, which is adds to those of generating more productivity, which directly contributes to greater economic growth, and more quality of employment than other sectors.”
One of the objectives of the National Pact for the Industry – agreed upon between the Government, employers and unions – is to raise the weight of the sector in Catalonia to 25% by 2030. That was an objective that the Generalitat already set in the Pact of 2017 and which was unable to comply.
