Spain's GDP Growth Masks Deep Economic Struggles for Majority

Despite Spain's headline economic success, with GDP growth rates exceeding EU averages, the prosperity is not broadly shared among its population. Spain's GDP has risen by 10% since 2019, and the European Commission forecasts a 2.9% growth for 2025, well above the EU average of 1.4%. However, this growth is partially attributed to a significant population increase driven by immigration, which added around 600,000 newcomers annually since the pandemic, pushing the population to nearly 50 million. Economists highlight that this demographic growth inflates GDP figures, while underlying socioeconomic conditions remain troubling.

Unemployment in Spain remains the highest in the EU at 10.45%, disproportionately affecting young people who also face soaring housing costs that force many to live with their parents until age 30, well above the EU average of 26 years. About 55% of Spaniards report worsened economic situations since the pandemic, with 90% experiencing a loss in purchasing power, as inflation in essential sectors outpaces wage growth.

In terms of poverty and inequality, 8.3% of Spaniards suffer severe material deprivation, surpassing the EU average of 6.4%, and Spain has the highest child poverty rate in the EU at 29.2%. Although there was a slight reduction in overall poverty from 20.2% in 2023 to 19.7% in 2024, severe poverty rose marginally. Wealth distribution remains highly unequal: the richest 25% have seen increased wealth over the past two decades, while the bottom 50% have stagnated.

The reliance on tourism and high-value services sustains economic growth but does not remedy structural problems such as high public debt, political instability, and low productivity. Experts argue that GDP growth alone is an insufficient indicator of true economic health because it ignores widespread inequality and poverty. Calls for increased social mobilization and systemic reform emphasize that the benefits of economic growth are failing to reach the majority of Spaniards.

As José Boscá, an economist with FEDEA, notes, "Current growth rates may not reflect the overall economic well-being of the population." The consensus among experts is that without urgent reforms and redistributive policies, Spain's impressive GDP figures will continue to obscure the economic hardships faced by many citizens.