What we know so far about Spain's next minimum wage increase
Spain's Interprofessional Minimum Wage (SMI) is set for another rise in 2024. Here's what we know so far, from when it is likely to come into force to how much extra money minimum earners are likely to get.
Spain's minimum is currently €1,080 gross per month over 14 payments (€15,120 gross per year), an amount that has been in place since February 2023. That amount now looks set to rise.
Spanish Deputy Prime Minister and Minister of Labour Yolanda Díaz has said that Spain's SMI "has to maintain purchasing power" and rise in line with the average CPI rate between December 2022 and November of this year, which she estimates will be between 3.7 and 3.8 percent.
When will Spain's minimum wage increase?
The government, unions and employers have already begun to outline their positions regarding the negotiation to raise the SMI that the self-employed and companies will have to pay their employees from 2024.
Experts predict that this will most likely happen from January 2024, but it depends on what happens in the meeting on Thursday November 30th.
How much is it likely to increase?
While no one yet knows exactly how much the Spanish minimum wage will increase and what it will be, there has been some speculation and various proposals.
The Spanish Confederation of Small and Medium Companies (CEOE-Cepyme) proposed raising the SMI by six percent over the next two years, to €1,112 over 14 payments in 2024 and to €1,145 in 2025, a proposal that the CCOO and UGT unions call "insufficient”.
The unions have made a counter proposal increase that reaches 60 percent of the average salary as they claim that the evolution of the price of basic products, such as food, must be taken into account. This equates to €1,200 over 14 payments instead.
Spain's Labour Minister also aims to achieve this increase to €1,200, which would take effect over the next two years.
What are the issues with Spain's minimum wage?
Spain's new PSOE-Sumar government needs to strike a balance between providing a decent income to workers and not dissuading employers from hiring more workers, which could destabilise the country's notoriously rocky economy and employment numbers.
The last minimum wage increase in February 2023 was of 8 percent; this time the rise will be between 3 and 12 percent.
Spain's left-wing parties consider that an SMI rise will improve the living conditions of workers struggling to make ends meet during times of high inflation, whilst right-wing parties such as the PP and Vox usually side with business owners and their opposition to mandated wage increases.
Admittedly, self-employed workers and small business owners will be the worst affected by the increase, having to absorb the increasing cost of hiring employees; not just higher wages but increased social security contributions.
How does Spain's minimum wage compare with other EU countries?
Spain still has a much lower minimum wage than some of its EU neighbours. For example, in May 2023 France increased its SMI from €1,709.28 to €1,747.2 per month.
If you take the Spanish SMI amount over the normal 12 months, this equals to €1260, which is still €487.20 less than the French each month.
In Germany it's currently €1,997 per month, in Ireland it's €1,909, in Slovenia it's €1,203 and in Portugal it's €886.
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Spain's minimum is currently €1,080 gross per month over 14 payments (€15,120 gross per year), an amount that has been in place since February 2023. That amount now looks set to rise.
Spanish Deputy Prime Minister and Minister of Labour Yolanda Díaz has said that Spain's SMI "has to maintain purchasing power" and rise in line with the average CPI rate between December 2022 and November of this year, which she estimates will be between 3.7 and 3.8 percent.
When will Spain's minimum wage increase?
The government, unions and employers have already begun to outline their positions regarding the negotiation to raise the SMI that the self-employed and companies will have to pay their employees from 2024.
Experts predict that this will most likely happen from January 2024, but it depends on what happens in the meeting on Thursday November 30th.
How much is it likely to increase?
While no one yet knows exactly how much the Spanish minimum wage will increase and what it will be, there has been some speculation and various proposals.
The Spanish Confederation of Small and Medium Companies (CEOE-Cepyme) proposed raising the SMI by six percent over the next two years, to €1,112 over 14 payments in 2024 and to €1,145 in 2025, a proposal that the CCOO and UGT unions call "insufficient”.
The unions have made a counter proposal increase that reaches 60 percent of the average salary as they claim that the evolution of the price of basic products, such as food, must be taken into account. This equates to €1,200 over 14 payments instead.
Spain's Labour Minister also aims to achieve this increase to €1,200, which would take effect over the next two years.
What are the issues with Spain's minimum wage?
Spain's new PSOE-Sumar government needs to strike a balance between providing a decent income to workers and not dissuading employers from hiring more workers, which could destabilise the country's notoriously rocky economy and employment numbers.
The last minimum wage increase in February 2023 was of 8 percent; this time the rise will be between 3 and 12 percent.
Spain's left-wing parties consider that an SMI rise will improve the living conditions of workers struggling to make ends meet during times of high inflation, whilst right-wing parties such as the PP and Vox usually side with business owners and their opposition to mandated wage increases.
Admittedly, self-employed workers and small business owners will be the worst affected by the increase, having to absorb the increasing cost of hiring employees; not just higher wages but increased social security contributions.
How does Spain's minimum wage compare with other EU countries?
Spain still has a much lower minimum wage than some of its EU neighbours. For example, in May 2023 France increased its SMI from €1,709.28 to €1,747.2 per month.
If you take the Spanish SMI amount over the normal 12 months, this equals to €1260, which is still €487.20 less than the French each month.
In Germany it's currently €1,997 per month, in Ireland it's €1,909, in Slovenia it's €1,203 and in Portugal it's €886.
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