The proposed increase in Spain’s Minimum Interprofessional Wage (SMI) by the Ministry of Labour and Social Economy has sparked criticism from trade unions, who argue that the suggested rise fails to match the soaring cost of living.
While the government has put forward an increase of between 3.4% and 4.4% – equating to an additional €39 to €50 per month on a 14-payment system – unions maintain that such an increment is “insufficient” to remedy the economic pressures facing workers since the pandemic.
Calls for a More Ambitious Increase
Manuel Navarro, the General Secretary of UGT in the Canary Islands, emphasised that the union’s primary goal is to continue advocating until the SMI reaches 60% of the national average salary, in accordance with European Union recommendations.
Although recognising the challenge of achieving such a leap in a single year, Navarro suggested that the 2025 SMI should aim for a near 6% boost to surpass the €1,200 threshold on 14 payments. Even this figure, however, would still fall short of the ideal 60% target.
The recent proposal, potentially bringing the annual benefit for SMI recipients to an extra €600, does little to ease the burden caused by rising prices. Navarro pointed out that workers’ purchasing power has long been eroded due to inflation and stagnant wages, especially during the pandemic years.
Broader Concerns Over Living Standards
From the perspective of Montserrat Cosano, Secretary of Action for Comisiones Obreras (CC OO) in the Canary Islands, the proposed wage hike remains inadequate for surviving the ever-increasing cost of living on the islands.
She highlighted that despite improvements in SMI since 2017, many residents still grapple with poverty. The gap between minimum wages and average salaries, while narrowing, is exacerbated by collective agreements that have not kept pace with wage increases, leading to stagnation even as corporate profits soar.
The situation in the Canary Islands, Cosano explained, is symptomatic of a "weak society" where low wages make it challenging to cover essential expenses such as housing, transport, and food. This economic fragility is further worsened by a predominantly part-time workforce in key sectors like services, trade, and agriculture, where unpaid overtime contributes to increasing poverty not just in economic but also emotional and social terms.
Growing Tensions Between Unions and Employers
Relations between unions and employers are reportedly strained. According to Cosano, companies have shown reluctance to engage constructively in wage and working hour negotiations.
She criticised employer resistance to proposals such as reducing the working week to 37.5 hours, which she claims have seen "a year and a half of fruitless negotiations" without meaningful proposals or acceptance from business leaders.
This unwillingness to negotiate is seen as a major obstacle to improving wage conditions, further distancing employers from the concerns of their workforce.
Historical Context and Economic Implications
Over the past ten years, the SMI in Spain has increased by nearly 84%, rising by €540 per month. Noteworthy surges occurred in 2019 with a 22.3% jump taking the wage to €900, and in 2023 with an 8% rise to €1,080. More recently, a 5% increase brought the current SMI to €1,134 per month.
The proposed hike would raise it closer to €1,184. However, employers are already expressing concerns. They argue that increases exceeding the 2.8% inflation rate at the end of 2024 would impose excessive labour market rigidity and additional costs, potentially leading to price hikes that pass the burden onto consumers.
As negotiations loom, the future of Spain’s minimum wage remains uncertain. Trade unions are poised to intensify their campaign to ensure the SMI reaches the €1,200 mark, highlighting the pressing need for wages that reflect the realities of a changing economy and cost of living conditions.
