Lorraine Williamson
Spain’s economy expanded by 3.2% in 2024, according to official data released by the National Statistics Institute (INE). The figure exceeds earlier forecasts of 2.7% and underscores Spain’s role as a key driver of growth within the eurozone.
Gross domestic product rose 0.8% in the fourth quarter, marking the fourth consecutive year of growth. While many economies across Europe struggled with sluggish output, Spain accounted for half of the eurozone’s total economic expansion last year.
The latest data also highlights the resilience of domestic demand. While foreign demand declined slightly, domestic consumption and investment helped sustain overall momentum.
Investment rebound and household spending lift growth
Investment activity rose by 2.9% in the final quarter, a sharp rebound from the 1.3% drop recorded in Q3. It was the highest investment growth rate in three years, suggesting renewed business confidence.
Meanwhile, household consumption increased by 1%, supporting broader economic expansion. Although the rate was slightly lower than the previous quarter, it has now outpaced GDP growth for three straight quarters.
Domestic demand contributed 1.2 percentage points to the quarter’s overall growth. In contrast, foreign demand subtracted 0.4 points.
Employment and wages support consumer confidence
Employment data also showed significant improvement. The Ministry of Employment, led by Carlos Cuerpo, reported that nearly 500,000 jobs were added in 2024 compared to the previous year.
Average wages increased by 7.5%, boosting household purchasing power and helping sustain consumer spending. Hourly productivity improved at an annual rate of 0.6%, further reinforcing economic stability.
Sectoral shifts highlight construction rebound
Performance varied across sectors. Construction grew by 2.7%, one of the standout figures for the quarter. The services sector remained steady, recording 1% growth. However, the primary sector contracted by 0.7%, the only major segment to decline.
Overall, Spain’s GDP reached €1.591 trillion in 2024, with the economy exceeding €400 billion in a single quarter for the first time.
Outlook for 2025
While the outlook remains cautious amid global uncertainty, Spain’s domestic economy appears well-positioned for continued growth. Analysts are watching closely to see whether rising investment and consumer confidence will carry into the new year.
Also read: Spanish economy continues to grow