José Alberto Celdran is a tough case, and he knows it. He sits in the back room of a private job agency in central Madrid, trying to piece together an employment history long in years yet short on details. He left school with the most basic qualification, spent a few years in the military, drove a taxi on Tenerife and worked as a security guard on building sites and shopping malls. He once caught a thief.

It is a message that the Spanish government — and policymakers across Europe — are trying to get across with growing urgency. Spain’s economic recovery remains on track and the unemployment rate continues its long retreat from a peak of 27 per cent three years ago. Mr Celdran, however, is part of a group that has struggled to benefit from the upswing: the long-term unemployed.

By definition, the category includes all job seekers who have been out of work for more than a year. But a decade of debt crises, property busts and multiple recessions have shut millions of workers in southern Europe out of the labour market for far longer than that: in Spain, for example, one in four unemployed has been jobless for more than four years.

“Long-term unemployment is starting to emerge as a policy priority in Europe. It imposes not just huge economic and emotional stress on those affected but is also likely to have a big impact on the recovery,” said Marcel Jansen, an economics professor at Madrid’s Autónoma University. The problem, he adds, is that “high long-term unemployment will transform into high structural unemployment”.

In other words: even if the Spanish economy continues to improve in the years ahead, Madrid will struggle to reduce jobless numbers beyond a certain point unless it finds ways to make the long-term unemployed employable again.

Official data show Spanish workers who have been out of a job for more than two years are much less likely to find new employment than others. Over the past three years, for example, their number has declined just 16 per cent, while the overall number of jobless fell 27 per cent over the same period.

After years of neglect, the government is finally paying attention. Last week, Madrid announced a €515m action plan that aims to provide individualised support for the long-term unemployed aged 30 to 54. Their cases will be handled by specialist “tutors” who will have no more than 120 job seekers to deal with at any time. According to Spain’s labour ministry, the limitation will allow the tutors to provide personal coaching and advice, including during the period after a job has been found.

But Madrid is also putting its faith in the private sector. Employment agencies such as Manpower, which runs the office now in charge of Mr Celdran’s situation, have been awarded contracts to take some of the toughest cases off the hands of the public employment agencies. The help they are asked to provide ranges from the most basic (writing a CV, setting up an email account) to the most complex — such as boosting the confidence and sense of self-worth of their disillusioned clients.

“We have to build them up again. Many of them have experienced so much rejection that they have decided to throw in the towel,” said Manuel Solis, chief executive of Manpower in Spain. The key, he argues, is getting the long-term unemployed back into work — any work, no matter how short-term or poorly paid.

We have to build them up again. Many of them have experienced so much rejection that they have decided to throw in the towel

“It is very hard to get that first contract. After that, the second and third contracts are not so hard,” he said. “Every insertion is good. But getting a permanent job or even a six-month contract in such a situation is just not realistic.”

In a country where many voice alarm at social inequality, low wages and the growing prevalence of precarious jobs, such views are not always popular. But the approach taken by Spain and similar countries in the past has not worked either, according to Mr Jansen. “We have a public employment service that is basically a benefits agency,” he said. What little effort went into active labour market policies often consisted of sending job seekers to training courses but without a clear idea of the jobs for which they were training.

For many, the recent shift in policy may come too late, especially for those close to retirement age. Others, however, should not be so easily abandoned.

“There are people who are in long-term unemployment and they are only in their 20s. They will be around, looking for work for another 40 years, so it would pay hugely if we manage to reconnect them with the labour market,” said Mr Jansen. “Spain cannot afford to turn its back on them.”