Spain's Economic Optimism Challenged by Rising Social Exclusion and Pension Concerns

Despite Prime Minister Pedro Sánchez's recent assertion that Spain's economy in 2025 "is performing exceptionally well," new data and expert analyses paint a far more complex and troubling picture. The FOESSA report, released on November 6 and supported by Cáritas, reveals that as of 2024, 9.386 million Spaniards—19.3% of the population—live in social exclusion, marking a 27.8% increase since 2007. Of these, 4.279 million face severe exclusion, with vulnerable groups including 29% minors and a striking 83% rise in exclusion among young adults aged 18 to 29 compared to 2007. The report also underscores that employment is no safeguard against poverty; around 38.2% of those moderately excluded and 21.3% severely excluded are employed, often in precarious positions. Additionally, housing costs have soared for renters earning below 40% of the median income, who now spend 71.6% of their income on rent, up from 48% in 2007.

Renowned entrepreneur José Elías, ranked 49th on Forbes with assets exceeding 900 million euros, has voiced serious concerns about Spain's pension system and housing affordability. He predicts that future retirees—"the grandparents of tomorrow"—will likely need to share apartments due to the mismatch between housing costs and expected pensions, which he estimates may be as low as 800 euros monthly. Elías highlights the demographic challenges of fewer pension contributors amidst a rising number of beneficiaries due to longer life expectancy and a reversed age pyramid. He calls out the political neglect on this issue, warning of a future where pension payments might not be sustainable. Elías also critiques the idealization of renting as a lifestyle, emphasizing it is only viable for those financially stable.

While Sánchez points to a slight rise in per capita GDP and economic growth driven by population increase, these macroeconomic figures seem disconnected from the lived realities of many Spaniards facing declining real wages, especially younger workers, and ever-growing social hardship. The FOESSA report and Elías’ comments collectively challenge the government's optimistic narrative, illuminating ongoing socioeconomic struggles in Spain that demand urgent attention.