Spanish Government Approves Significant Minimum Wage Increase for 2025

In a move that is set to benefit over 2.5 million workers in Spain, the Spanish government has officially approved a substantial increase in the minimum wage (SMI) for 2025. This decision, announced on January 31, 2025, by Second Deputy PM and Minister for Labour Yolanda Díaz, marks a significant step in the government's efforts to improve the living standards of the country's most vulnerable workers.

The New Minimum Wage

As of January 1, 2025, the minimum wage in Spain will rise by 50 euros per month to 1,184 euros gross, paid in 14 installments annually. This increase represents a 4.4% rise from the current minimum wage of 1,134 euros per month. The new wage ensures that the SMI remains at 60% of the average net salary, a requirement stipulated by the European Social Charter.

Negotiations and Agreements

The approval of this increase follows intense negotiations between the Ministry of Labour, trade unions, and employers. Despite initial resistance from employers, who had proposed a lower increase of 34 euros per month, the government and trade unions managed to reach a consensus on the higher figure. The main trade unions, UGT and CC.OO, had initially sought a more substantial increase of 66 euros per month but agreed to the 50-euro rise to secure an agreement.

Impact on Workers and Economy

This increase is expected to have a positive impact on various sectors, particularly retail, agriculture, and hospitality, where a significant portion of workers earn the minimum wage. According to estimates, the total labor cost in these sectors will rise, but the government argues that this will contribute to a better quality of life for workers. Agriculture, in particular, will see a significant impact, as 40% of its workers receive the minimum wage.

Additional Measures

Alongside the wage increase, Labour Minister Yolanda Díaz has committed to setting up a new table of talks with all interested parties to analyze and adapt the regulation governing the minimum wage. This includes measures to guarantee compliance with the minimum wage in affected industries, the automatic application of the SMI in collective agreements, and the updating of daily and hourly amounts if the working day is reduced.

Context of Labor Reforms

This move is part of a broader set of labor reforms being implemented by the Spanish government. Recently, the government took the first legislative step towards reducing the working week from 40 to 37.5 hours without a loss of pay, a measure that has been welcomed by unions but opposed by employers. While the reduction in working hours faces challenges in its approval process, the minimum wage increase has been secured through a bipartite agreement between the government and trade unions.

Conclusion

The increase in the minimum wage is a significant victory for social dialogue in Spain and reflects the government's commitment to improving the economic conditions of its most vulnerable citizens. As Minister Díaz emphasized, "Today we take a step forward. This is good news for our country. We can say that workers are going to be a little better off today." This move is expected to have a tangible impact on the lives of millions of workers, particularly in sectors that have been hardest hit by economic challenges.