The cold statistics tell us that we are all having economic problems, and that we are finally in economic recession. It hits different people in different ways, but the one certainty is that it touches all our lives, rich or poor, retired or working. It hits working people most, and those self-employed who run small businesses that need credit. The question many people are asking themselves is: will I be going to work tomorrow? Will I have a job? The unemployment figure in the region is rising sharply: 683,777 Andalusians are now unemployed, the biggest number in the past 14 years.

We spoke to five Andalusian businesspeople in different sectors throughout the province, taking a closer look at what exactly is happening to them right now and analysing their perspectives on the future. Their businesses range from marble and ham to furniture making, baking and tourism, and they carry out these businesses in Lucena, Marbella, Estepa, Cumbres Mayores and Macael. The big question they are all asking is how they will reach the end of the year without going out of business.

Last month a total of 42,000 people lost their jobs in Andalucía, and 10,000 of those were working in the building industry. Christmas, for them, will mean lean times this year.

The economy of Spain as a whole, and Andalucía in particular, depended too much on the building of houses over recent years, and this is a non-productive industry with little knock-on effect for long-term employment in the region. But the building industry also provides employment for many other sectors, from interior designers to plumbers, carpenters and electrical suppliers. In Macael, for example, which was one of the places we looked at, only those companies which work at an international level are managing to survive.

Confidence

The banks are coming under criticism by many of these businesses, especially in the Almeria region, where much credit has been cut off for small building companies. Zero tolerance would appear to be the order of the day, and any slight delay in repayments of loans is reason for one’s local bank manager to call in the full loan. The Confederation of Andalusian Businesspeople has requested help from the Junta de Andalucía to apply emergency aid measures, including a public investment of 8,000 million euros. But the five businesspeople we spoke to are simply asking that the banks confide more in the people whom they were established to help, by injecting more money into the local economy. They point to other countries affected by the economic crisis, which have taken similar measures with respect to their own troubled economies.

But as we can see in this report, all is not gloom and doom. Christmas may not be such an unhappy time in some areas we looked at.

Javier Espinosa, UNEMAC (Lucena) - “There is pessimism; sales have fallen by 30 per cent”

Right through the nineteen nineties, the town of Lucena, in the province of Cordoba, was where most people went to purchase furniture. But now that cheap furniture chain stores have opened in large shopping centres, coupled with falling sales in every sector, the Lucena furniture industry is in trouble.

This means serious problems for the people of this region, about 7,500 of whom make a living in the 590 furniture-making businesses in the Lucena area, which turned over a total of 534 million euros last year.

Javier Espinosa, president of the Union of Wood Businesspeople of Cordoba, tells us that they have not seen massive job losses so far in the industry, but says that business has fallen by between 30 and 40 per cent over the past year, with respect to the previous year. “There is a lot of pessimism in the industry,” he says, “but nobody really knows how far the recession will reach here.”

The biggest problem he sees is lack of credit to meet increasing costs in the industry, although falling sales is also a serious problem. This, he tells us, is largely due to the proliferation of large chain stores in shopping centres all over the region, and the tendency for people these days to spend less for inferior products.

“People seem to think that with a table and a plasma television set, they have furnished their sitting rooms,” he says.

“There are many of us selling very little,” he says, adding that some of the companies selling abroad are not suffering as much.

Pepe Romero, Nuevo Reino restaurant (San Pedro) - “Business lunches are largely a thing of the past”

Spaniards in general, and Andalusians in particular, have traditionally sealed business deals over lunch in a local restaurant, but these days, the tradition is dying. “Business lunches are largely a thing of the past,” says Pepe Romero, owner of a beachside restaurant in San Pedro Alcántara.

Romero has spent the past 22 years of his life in the restaurant business, and his restaurant has become well established in that time. He has been employing 40 workers in recent years, but last month was forced to lay off 16 of them. His only hope, he says, is that he will probably be in a position to take them on again before the Easter period.

“The economic crisis of 1989 and 1990 was very difficult for us,” he says, “but it seems as if this one will be even worse. Many people came here in the past to move into new houses and spend short holidays in second homes in the area, but this too is a thing of the past.”

His clientele is mostly made up of middle-to-high earners. “They usually come from the United Kingdom seeking quality food, and for the moment at least, they keep coming,” he says. But he ended October with a 9.26 per cent fall in sales, with respect to the same period last year. And last August was the first August in more than ten years in which sales did not increase. “They fell, in fact, by seven per cent,” he adds.

With the arrival of the low season and falling sales, he has been forced to close two of his four dining rooms, although as he points out, his situation is not as bad as in other parts of the Costa del Sol, where winter brings an almost total close-down. “We have some very good Madrid and Basque clients who have homes here, and they come most weekends. But one notices they are not spending as much as in previous years,” he says.

Antonio J. Carmona, Cargu Marble (Macael) - “The banks are hurting us all now, and people are worried”

The home of the marble industry in Andalucía is in Almeria, where some 200 companies turn over an average 760 million euros each year. But as in everywhere else in Spain and throughout Europe, a sharp drop in the building industry has adversely affected the production and sale of all building supplies, including marble products.

Antonio Jesús Romero has spent 35 year running his own company, and is no stranger to hard times. “We has a crisis in 1991, but then the banks lent a hand,” he says.

Romera is very critical of the banks at the moment. “They only give credit to companies that put up personal property as security,” he says. This leads, he adds, to a long nightmare for many small marble companies in financial trouble.

One of the problems is that the building companies do not pay for the marble they take possession of for between 90 and 120 days, and sometimes even 180 days. “And although the builder might be a multinational company, some banks are not trusting them to pay and refusing to grant us payment facilities in the meantime,” says the owner of the Cargu Marble company.

The result is that many family companies are now bankrupt. “The banks are causing us a lot of damage, and people are very worried about it,” says Carmona. And this, he adds, is after they have received 1,700 million euros in state aid and with lower interest rates.

The crisis in the industry is affecting 29 municipalities in the province of Almeria. “We have just had the Macael feria, and almost nobody turned up. One cannot drink beer and have a good time in such an economic climate, not knowing if you have a job next month,” says Antonio Carmona.

Marcos Galván, La Estepeña (Estepa) - “Spaniards like to fall back on old traditions in hard times”

The aroma of cinnamon and almond greets the visitor who enters this bakery, where polverones (traditional Christmas pastries eaten with wine) are made by the million for families all over Spain.

The Galván family have been making polverones in Estepa for the past century and a half, producing 4.6 million of them each year in their modern bakery. The Christmas season, clearly the busiest for them, began some weeks ago, and since then thousands of boxes have been sent to supermarket chains all over the country.

“Our Christmas season is not very different from last year’s,” says Marcos Galván, manager of La Estepeña. “We have hardly noticed the economic crisis this year.”

He is aware of the fact, however, that the real test begins about now, once the polverones and other Christmas pastries are on the supermarket shelves. A recession of this kind does not usually affect the food sector as much as others, but in the current economic climate, anything could happen. “I believe that we Spaniards return to traditional values in times of crisis, and Christmas pastries obviously fall into this category,” says Galván. Some steps have been taken, nevertheless, to ensure continuing sales of the product, with price reductions for boxes of polverones, but with no reduction in quality. The La Estepeña company employs 250 people during this period, which lasts from August to December, and turned over 14 million euros last year, which accounted for almost 40 per cent of total sales in the industry that this Seville company created 150 years ago.

Other companies in the sector have begun to notice the recession, and many of them, especially those marketing Christmas hampers, have already begun to cut costs.

Enrique Castaño, Enrique Hams (Cumbres Mayores) - “People are still eating ham for breakfast, but that could change”

Do people keep eating luxury foods during a recession? That is the question that Enrique Castaño, owner of the well-known Enrique Hams company in Huelva, asks himself, and the answer, he knows, is ‘yes they do,’ so far. In fact, during the first two minutes of this interview, he had to speak to two different clients on his mobile phone. The result: two more orders. Both were from Seville, one a fairly large order for top-quality ham, while the other, as well as hams, included other pork derivatives produced by this company, one of the biggest in the region. In this case too, the order was for top-of-the-range goods.

The Cumbres Mayores company alone, in the Jabugo area, kills some 50,000 pigs each year, producing hams of the highest quality and selling them mostly to regular clients throughout the region. Many of their clients are top restaurant owners in the Cadiz, Huelva and Seville areas.

Castaño has a very personal opinion on the recession. “Whenever it rains, one gets wet, but I believe the situation has been exaggerated,” he says. As far as he is concerned, most people can still afford to have ham for their breakfast every morning, all over Spain. “How the situation will be in two years time I do not know,” he says. “Perhaps then we can speak of a real economic crisis.” Sales of hams increase dramatically at Christmas, he tells us, although adding that he believes most people will wait until the last moment to buy. Castaño is clearly optimistic about the future of his business.

“There is a lot of fear and tension in the air tight now, but we have excellent unemployment assistance in this country, and I believe the situation will get better in the short term. We must be optimistic about it.” As far as non-payment of goods delivered is concerned, he says nothing has changed in his business so far, mainly because he is not paid in any case by restaurateurs for his hams until they have been consumed by the restaurant’s clients.

“Many people live beyond their means,” he says, “and then they have to face reality. This happens a lot in the Seville Fair, for example.”