Navarre: A Well-Connected Region

Unlike many other areas of Europe, Navarre counts its industrial history in decades, not centuries. This brings benefits in both the physical environment and in the work force.

While many areas are laboring under reconversion programs to breathe life back into their basic industries, most of Navarre's physical plants are relatively new. "We don't need to rebuild anything because we have nothing to rebuild," says Jésus Zabalo of SODENA. "All our companies started in the 1960s and 1970s."

Zabalo says this also has implications for work force attitudes. "People in Navarre have the mentality to accept change, and this is what makes Navarre so attractive to foreign manufacturers," he explains. "When you talk about total quality management, teamwork and working in multifunctional groups, these are things we accept in our culture. In older industrial areas you may have to overcome entrenched attitudes. Here, companies find it is easier to start with a new mind than to change an old one."

He cites as one significant example his own ability to introduce a 19-shift-a-week work schedule while he was managing director of a foreign-owned auto components plant. Such a schedule had never before been seen in Navarre but was accomplished successfully with no resistance.

The use of temporary workers is accepted practice in Navarre. With this extended work force companies are typically open and working on summer holidays. Many companies have reduced the traditional summer plant shutdown from three or four weeks to two or less.

This flexibility and adaptability of Navarre's work force is particularly important in light of Spain's poor labor relations image. As the nation transitioned to a democracy in the years following Franco's death, the country experienced a plethora of political and labor problems. Strikes were frequent, the social agenda was expensive and labor policies (like guaranteed lifetime employment) were restrictive.

Navarre's industry executives concur that the image is no longer deserved. The restrictive labor laws are changing, as unions and employees understand the need for greater flexibility. A series of smaller reforms in recent years somewhat eased the labor law rigidity. Those reforms were capped recently by overwhelming approval by the Spanish Parliament of landmark legislation that gives employers much greater flexibility in hiring. The pact is the result of almost a year of negotiations between labor and business groups.

Industry executives in Navarre will admit labor is not cheap. Three decades of intense training have boosted skill levels to world-class quality. But they will also say that the worker is worth his price. "This is the place to find workers for specialized jobs requiring specialized skills," says one executive.

Navarre's geographic position at the crossroads of Atlantic Coast and Mediterranean traffic means easy access to any point in Spain and Europe.

Navarre launched an enormous effort in the last few years to improve communications with the rest of Europe. Infrastructure improvement programs include better roads and better air service. There are new bypasses around Pamplona, a new highway linking Pamplona and San Sebastian and another to Vitoria.