Wages weigh more in the economy, but the worker does not notice it. Why?

BarcelonaThe Spanish economy remains at the forefront of advanced countries in growth, with a forecast of 2.6% this year according to the Bank of Spain and 2.5% according to the International Monetary Fund (IMF). But inflation, they also warn, eats away at the purchasing power of wages that are not enough to buy or rent a house. The remuneration of employees has gained weight in the Spanish economy, but it is starting to lose it in favor of the profits of some business sectors. Workers perceive that with every euro they buy fewer and fewer things, or that they need more to acquire the same. There is a palpable reality, the rise in prices, which has stalled the contribution of wages to the total wealth this year, and a psychological element, according to the experts consulted, which makes many ask themselves: "Now that the economy is doing well, when is it my turn?"

From wage devaluation to the pandemic

The labor market has recorded a substantial increase, especially in recent years. From 2010 to 2025, the employed population has increased by almost 22% in Spain, from 18.7 million in the fourth quarter of 2010 to the current 22.8 million. 4.1 million more employed people have been added (in Catalonia, it has gone from 2.73 million employed wage earners to 3.34 million).

What they earn in total has increased by 55% in this period. But a good part is due to the minimum wage (SMI), which is received by around 10% of the employed population, and which has almost doubled in this period, with strong increases, especially with the 22% jump in 2019. This has reduced inequality at the lower end of wages for young people or low-skilled sectors, but not as much for the rest.

One of the moments when wages lost the most weight was the period of wage devaluation, a process initiated after the 2008 financial crisis that consisted of lowering wages and labor costs, which mainly affected low salaries and also the most common ones. Between 2010 and 2016, the share of wages in GDP fell due to the great destruction of employment – in Catalonia in 2012 the unemployment rate reached 23.8%, which contrasts with the current 7.9% – and the freezing or reduction of wages. In contrast, corporate profits gained weight in total income during this period.

With the pandemic, in 2020, gross business profits fell abruptly due to the paralysis of activity, while labor income was sustained by public protection mechanisms, such as temporary employment regulation plans (ERTO). According to CCOO, in 2021 and 2022, once the pandemic was over, inflation had an uneven impact, but "wages lost share in the gross value added generated by companies in favor of capital income," according to CCOO.

From Ukraine to your pocket

Once Covid was left behind and the economy had recovered further, between 2023 and 2024, despite the increases in corporate margins due to the escalation of inflation, which reached its peak in July 2022 (10.8% in Spain and 10.3% in Catalonia), significant employment growth and subsequent wage increases caused employee compensation to regain weight.

Although the nominal increases in the SMI (Minimum Wage) have been very notable, inflation has eaten up a very significant part of these increments. For the average salary, real growth has been practically zero or negative in some financial years. In 2024, the latest closed data from the INE, the average annual earnings per worker were 29,540.26 euros (2,470 euros per month). But the mode, which is the most common amount, was 16,520.18 euros (1,376.68 euros per month). In addition, almost 40% of employees were in the range between 16,000 (1,333 euros per month) and 23,000 euros per year (1,916.7 euros per month). They have gone up, but not enough to cover basic expenses.

In recent years, jobs have been created in sectors with higher added value, with higher salaries, and in the public sector, which usually has higher salaries than the private sector. At the same time, more mature activities, which paid salaries above the average, such as industry or the financial sector, have experienced retirements with high benefits for staff who have been replaced by young people with lower salaries, explain sources from the CCOO economic cabinet. These are lower wages to face costs that are higher, such as housing, energy (which has skyrocketed), or the shopping basket, they add.

More geopolitical instability and rising prices

The war of the United States and Israel against Iran and the instability in the Persian Gulf have once again bitten into the purchasing power of wages and have pronounced the effects of the conflict in Ukraine. This increase in costs is being transferred from energy to other prices that consumers pay. "The added value generated by companies is growing, but wages remain stagnant," explain sources from CCOO.

The unions denounce this. For example, the UGT of Catalonia demands wage increases from employers' associations that allow for the recovery of lost purchasing power. The year-on-year CPI in Catalonia reached 4.5% this September (2.5% in the same month of 2025). In Spain, year-on-year inflation is even higher, at 4.9%. The demand is important, because only one in four workers is subject to an agreement with a revision clause, according to CCOO. Data from 2026 "confirm that the recovery in the weight of wages that occurred until the first quarter of 2025 has slowed down". In contrast, corporate margins remain "at historically high levels". They highlight the energy and financial sectors.