Southern European welfare precarization under EU austerity: Upgraded HCA and sigma-convergence analysis of Troika’s conditionality

The 2008 Great Recession noticeably disrupted Southern European (SE) countries by triggering a sovereign debt crisis that entailed Troika’s imposition of austerity measures. Literature has presented intriguing findings concerning conditionality political-economic causes and socio-economic consequences, but it has neglected a comprehensive analysis over SE welfare arrangements. In this article, I intend to assess which has been the role of EU austerity measures over SE welfare arrangements. I considered that conditionality to restructure public accounts altered SE welfare states by deteriorating pre-crisis institutions. In order to reduce debt and increase competitiveness, Brussels’ requirements comprised expenditures retrenchments and policy programmes reshaping. Thus, this article envisaged a precarization process that aggravated already rudimentary Mediterranean welfare. However, SE countries’ common experiences – both before, during and after crisis – were expected to have maintained a distinct SE welfare regime so far. In order to test this argument, this article relies on two traditionally used methodologies, Hierarchical Cluster Analysis (HCA) with sigma-convergence analysis, although great efforts have been conducted to overcome literature methodological concerns regarding variables selection and data. Finding have confronted previous literature results and this article’s expectations. First, there is no trace of a SE welfare regime before 2014. Neither historical legacies nor crisis effects established a model that started to take shape after austerity conditionality in 2011. Second, SE countries have noticeably deteriorated, approximating rudimentary CEE welfare models. Precarization is mainly observed in healthcare, education, and family policies. In consequently, these results encourage future research to readdress previous literature on welfare regimes, by accounting for medium-term time spans and larger samples of countries.