Spain Sees Employment Rise Amidst Growing Worker Poverty Risk

Spain’s labor market reports a paradoxical trend as employment hits historic highs while poverty risk among workers escalates. In October 2023, employment increased by 141,926, reaching a record 22.38 million people employed, according to the National Statistics Institute (INE). Despite these figures, unemployment remains high at 2.44 million individuals, and 11% of employed workers—approximately 2.4 million people—are at risk of poverty. When combined with the unemployed, nearly five million Spaniards grapple with poverty or semi-poverty, some enduring extreme hardship.

This troubling scenario is partly linked to the rise of low-paying jobs. While increases in the Minimum Wage (SMI) have been praised by union leaders, these have not fully addressed underlying wage stagnation, resulting in many workers relying on minimum wage jobs to stay afloat. Additionally, the housing crisis compounds these issues, as high prices and low incomes make housing unattainable for many.

Regionally, disparities persist. In Aragón, for example, 12.7% of workers live at risk of poverty, exacerbated by rising prices and stagnant wages, which severely limit purchasing power. The exclusion rate there has surged by 83.2% in just six years, underscoring the deepening economic challenges faced by workers in that region.

Spain's activity rate stands at 59.30%, notably below that of neighboring France and Germany, raising concerns about full economic participation despite positive macroeconomic indicators. The ongoing tensions between employment growth and economic hardship illustrate the complex realities behind Spain’s labor market figures. As one reflection puts it, social welfare and economic governance will be tested by whether poverty remains a source of shame or a call to action for policymakers.