A street-sweepers strike in Madrid has left streets strewn with paper, broken glass and other litter, dealing a blow to the Spanish capital's image when it is already suffering a tourist slump.

"Today I was told of the first cancellations. If the strike continues in the coming days, there will be serious repercussions on tourism," said the secretary general of the Madrid Association of Hoteliers, Antonio Gil.

With the walkout in its second week, images of residents of the city of 3.2 million people making their way beside piles of cardboard boxes and torn garbage bags have been broadcast by newspapers and TV stations around the world.

"Madrid looks like a garbage dump," said the president of the Madrid Confederation of Commerce, Hilario Alfaro.

"This comes at the worst moment. We hope that this is resolved before the start of the Christmas season, which begins at the end of November."

Street sweepers and gardeners at public parks began an open-ended strike on November 5 against plans to cut their salaries by up to 40 percent and slash 1,135 jobs out of a total of around 7,000.

The private companies that provide cleaning services to the city already laid off 350 workers in August.

They said cuts were necessary since the city hall, under pressure to reduce costs like public authorities around Spain, was spending less on cleaning.

The strike comes as Madrid is suffering a drop in international visitors even as visitors to Spain overall are up.

During the first eight months of the year Madrid received 2.76 million foreign visitors, a 7.7 percent drop over the previous year. Foreign visitors to Spain rose 4.5 percent during this period.

The alarm of the tourist sector was fuelled by news that in August Madrid airport suffered the biggest slump in passenger numbers among Europe's major hubs and for the first time in history was not Spain's busiest airport, having been surpassed that month by Barcelona's airport.

The capital has since regained its title as Spain's busiest airport but the statistic drew attention to Madrid's failure to market itself effectively as a tourist destination.

The city's confidence over its standing in the world took another hit in September when Madrid lost its bid to host the Olympics for the third time in a row.

"We are going through a low point in Madrid, it is an accumulation of situations which are hurting Madrid's development," said Alfaro.

Madrid Mayor Ana Botella received a barrage of criticism over her English-language presentation to the selection committee for the 2020 Olympics and her unmistakable Spanish accent as well as some surprising phrases, especially her assertion: "There is nothing quite like a relaxing cup of cafe con leche in Plaza Mayor".

Botella, the 59-year-old wife of former conservative Spanish prime minister Jose Maria Aznar, now finds herself under fire over her failure to end the street-sweepers' strike.

Madrid city hall announced Sunday that it was boosting municipal police patrols to ensure that workers were able to carry out minimum services, which were set at 40 percent for street sweepers and 25 percent for garden workers.

Botella on Wednesday accused some striking street-sweepers of preventing minimum services to be carried out and said this amounted to "vandalism and sabotage".

She also threatened to hire a public firm to carry out the cleaning of the streets of Madrid if the private companies which currently provide cleaning services do not reach an agreement to end the work stoppage within 48 hours.

Madrid residents "do not have to endure the blackmail of a strike that has taken them hostage", Botella told a televised news conference.

"For now it is ok still but they have to do something because soon it is going to start to stink," said Anna Schultz, a 20-year-old German student who was on holiday in Madrid, in the central Plaza de Sol square, which was covered with paper, empty cans and bottles.