SPANISH Prime Minister Pedro Sánchez announced on Tuesday that his government would once again raise the national minimum wage, the fifth time his Socialist Party-led administration has done so since coming to power.
The SMI, as the lower limit on pay is known in Spain, will be going up from €14,000 a year to €15,120, which is a rise of 8%.
Assuming a worker receives 14 payments over the year, as is the norm for most Spanish salaries, that is an extra €80 a month for someone working a 40 hour week.
The measure will be retroactive, meaning that anyone receiving the SMI will be paid extra for the month of January.
‘In 1999, a Spaniard needed to dedicate four annual salaries to buy an apartment. Today, he or she needs to spend more than twice as much: eight annual salaries,’ Sánchez told Spain’s upper house of parliament, the Senate, in comments reported by Reuters.
The secretary general of Spain’s CCOO union, Unai Sordo, said that 2.5 million people will benefit from the measure. In particular, female workers, young people, temporary employees and those in the service and agriculture sectors will be better off.
The government met with the unions on Tuesday morning to inform them about the hike. But missing from the meeting were the country’s main employers’ associations, who oppose the increase and had suggested a 4% rise instead.
Despite the opposition of these associations, their members will still have to observe the new SMI.
When the government – a coalition of the Socialist Party and leftist Unidas Podemos – came to power in 2020, it had made a joint commitment to increasing the net minimum wage to 60% of average monthly pay by the end of its term.
A general election is due at the end of this year, and according to press reports the SMI is now at between 52% and 60% of the average pay depending on which benchmark data is used.
Spain’s increase of the minimum wage is part of a Europe-wide trend, as governments struggle to get to grips with inflation. According to data cited by Reuters, average inflation in 2022 was at 8.4% in Spain.