Faced with the usual complacency of the Government and its “synchronized opinion team” regarding the evolution of the Spanish economy—the envy of Europe, they say—the pro-government newspaper El País breaks ranks today with an editorial that reflects what the specialized Spanish press has been saying for years: Spanish GDP growth is driven by a massive influx of immigrants (four million during Pedro Sánchez’s two terms) who push consumption upward, yes, in exchange for putting downward pressure on wages and driving up real estate prices… And by a massive increase in public spending—further doped by the arrival of European funds—which is largely current expenditure (pensions, salary increases for civil servants…) rather than investment that would allow for the improvement of the productive apparatus.
Like Paul of Tarsus, the editorialists of El País seem to have fallen off the horse of Sanchista propaganda. Therefore, due to its novelty, we reproduce in its entirety today’s editorial from El País, June 19:
Spain, a Low-Cost Economy
GDP growth conceals decades of wage stagnation and a weak business fabric
The macro figures of the Spanish economy are dazzling. GDP grew by 16% between 2022 and 2025, compared to an average of 6.5% in the eurozone. Employment is at historic highs with around 21.4 million people employed. And the current account surplus, driven by tourism, stands at around 2%-3% of GDP. However, the average worker perceives that their purchasing power is nowhere near reflecting such an expansion. The Spanish economic miracle, which arouses surprise and even admiration in other countries, exhibits deficiencies that the political debate, mired in polarization, repeatedly ignores.
Behind the GDP data lies a model that grows by relying on low wages, small businesses, and modest investment rather than productivity, innovation, or added value. All of this is beginning to outline a low-cost economy.
On one hand, more than 94% of the Spanish business fabric is made up of companies with fewer than 10 workers. And smaller size means less financial capacity, slower response speed, and lower investment.
Spain allocates around 1.4% of its GDP to research and development, according to Eurostat, well below the European average (2.2%). Half of this effort is private, but two-thirds of the spending is carried out by large companies, which are not representative of the country’s business fabric. Regarding salaries, although the minimum wage has accumulated a rise of more than 60% over the last eight years, the improvement has not pushed the rest upward. Workers’ compensation has remained practically stagnant for three decades because inflation has eaten away at the raises. This has consequences: Spain is the EU country with the third-highest rate of workers at risk of poverty, at 11.2%, trailing only Luxembourg and Bulgaria.
Growth alone does not mean converging with Europe. GDP per capita adjusted for purchasing power parity stands at around 92% of the EU average, more than 20 points below the German economy and nearly 10 points below France. The gap is narrowing, but at an unsatisfactory pace.
The diagnosis presented last March by the Productivity Council of Spain on the limits to economic convergence is highly relevant: between 1995 and 2017, productivity fell by around 10.5% in Spain, compared to an increase of 1.4% in the eurozone and 4.5% in the EU. And between 2022 and 2025, years in which the economy exhibited such a positive differential performance, it barely improved by 1%. In the opinion of experts, productivity is the only factor that can allow for sustained growth and improve long-term well-being. This is the long-term debate—focusing on citizens’ well-being, the reduction of inequalities, and the future of the country—that should be central to political parties’ agendas.
