The Spanish government has received a recommendation to raise the national minimum wage (“Salario Mínimo Interprofesional”, or SMI) by up to €50 per month. This advice comes from the Committee of Experts tasked with ensuring fair wage growth aligned with European standards.
If implemented, the new SMI could reach up to €1,184 per month. Here’s what you need to know about this proposed change and its potential implications.
Proposed increase in the SMI
The Committee of Experts has suggested two possible increases for 2025:
- A 3.4% rise, which would set the SMI at €1,172.50 monthly (across 14 payments).
- A 4.4% rise, bringing the figure to approximately €1,184 monthly.
Currently, the SMI stands at €1,134 per month. The Ministry of Labour plans to apply the increase retroactively from January 1, 2025, pending negotiations with social and economic stakeholders.
Meeting European standards
The recommended adjustment aims to align the SMI with the European Social Charter, which mandates that minimum wages should equal at least 60% of the national average salary. The Committee of Experts, established in 2021, has been working to ensure the SMI maintains this benchmark while protecting workers’ purchasing power. Their latest report underpins the government’s negotiations with unions (CCOO and UGT) and employers (CEOE and Cepyme).
When compared to other European countries, Spain’s minimum wage falls into the second group of countries with minimum wages above €1,000 but below €1,500 per month. Minimum wages vary a lot between European countries. According to data from Eurostat minimum wages are as folows:
- Luxembourg €2,571
- Ireland €1,767
- Netherlands €1,756
- Belgium €1,703
- Germany €1,621
- France €1,767
- Spain €1,323
- Slovenia €1,254
- Bulgaria €477
Eurostat presents minimum wage data as gross earnings as well, but it is standardised across different countries for comparison purposes. This means that the figures are before any deductions, but they might be adjusted or presented differently to ensure consistency across the European Union. That is why the reflected minimum wage by Eurostat is different than the minimum wage Spanish experts talk about.
Social dialogue and negotiations
Second Deputy Prime Minister and Minister of Labour Yolanda Díaz expressed optimism about reaching an agreement with unions and employers. “I believe there is room for consensus. Once the experts present their proposal, we will convene the social dialogue table,” Díaz stated. The committee’s findings were finalized on January 8, paving the way for imminent discussions.
While unions have consistently supported SMI increases, employers’ associations have often raised concerns. They argue that higher minimum wages strain small businesses and specific sectors, such as agriculture. Despite this, the government has pressed forward with yearly increases, emphasising the need to safeguard workers’ livelihoods.
A track record of wage increases
The SMI has seen significant growth under the current administration:
- 2024: A 5% increase from €1,080 to €1,134 per month.
- 2023: An 8% rise agreed with unions but not employers.
- 2020: A more collaborative effort resulted in an increase from €900 to €950.
Despite employer resistance, these changes reflect the government’s commitment to improving income security for low-wage earners.
Future reforms
To prevent political delays, the Labour Ministry is considering legal reforms to automatically adjust the SMI based on economic indicators. This would eliminate the need for annual negotiations, ensuring consistent compliance with European standards.