Spain's Economy Grew Faster Than Peers After Pandemic Policies

Spain's economy expanded while the United Kingdom, Germany, and France contracted after the coronavirus pandemic. Over the past three years, Spain accounted for one out of every three jobs created across the European Union. Disposable income rose three times as fast as in France and eight times as fast as in Germany.

Unemployment, poverty, and inequality fell to their lowest levels in nearly two decades. In 2024, The Economist ranked Spain as the top-performing economy worldwide. The Spanish Socialist Workers' Party remained in office for eight years.

Following the 2008 financial crisis, several major Spanish industries collapsed and unemployment reached 27 percent. The banking system required an EU bailout. More than a decade later, incomes and employment had not returned to pre-crisis levels. Protests spread across the country.

Support increased for parties on the far left and far right. In the 2019 national elections, Vox, a far-right party, rose from zero seats to become the third-largest party with 15 percent of the vote.

After COVID-19 arrived, the government paid wages to keep workers on payroll and extended loans to businesses. When demand rebounded in 2021, officials identified a labor shortage in an aging population. The administration increased legal work visas for Latin American migrants and fast-tracked authorizations in sectors facing shortages.

The government also tightened enforcement against unauthorized Mediterranean boat arrivals. José Luis Escrivá, who served as minister of inclusion, social security, and migration from 2020 to 2023, described recruitment trips to migrant camps on the U.S.-Mexico border.

The same period included increases to the minimum wage, energy-price controls, and a form of guaranteed income. Housing shortages have since emerged as a new constraint on continued growth.