1.2. Economic context
In macroeconomic terms, the last 15 years have been fluctuating between two worldwide shocks. Following an expansionary cycle, the economic and financial crisis resulted in a deep decrease in the GDP growth rate (−3.8% in 2009) (World Bank, 2023). After 2014, GDP recovered, reaching USGDP growth rate (−3.8% in 2009) (World Bank, 2023). After 2014, GDP recovered, reaching USGDP growth rate (−3.8% in 2009) (World Bank, 2023). After 2014, GDP recovered, reaching USGDP growth rate (−3.8% in 2009) (World Bank, 2023). After 2014, GDP recovered, reaching US$ 29 555 per capita in 2019 (World Bank, 2023). However, due to the COVID-19 pandemic, GDP growth rate plummeted at −11.8% in 2020 (US$ 26 984 per capita). GDP steadily recovered, reaching US$ 29 675 in 2022 (World Bank, 2023) (Table1.2).
Table1.2
The public deficit has been reduced from 5.3% in 2015 to 4.7% of GDP in 2022, with a sharp increase in 2020 due to the pandemic response, reaching 10.1%. Cumulative public debt has increased from 103.3% of GDP in 2015 to 111.6% in 2022 (Eurostat, 2023b).
Government public expenditure has evolved in response to these variations, growing to cope with the economic and financial crisis in 2012, decreasing down to 42.3% in 2019, and sharply increasing again to 51.9% of GDP to manage the COVID-19 pandemic in 2020, the biggest percentage of GDP dedicated to public expenditure ever reported. In 2021 and 2022, public expenditure decreased to 50.6% and 47.4% of GDP, respectively (Eurostat, 2023b).
In 2021, public expenditure on health (€88 562 million) accounted for 7.2% of GDP (equivalent to 15.6% of total public expenditure), while social protection expenditure (such as unemployment benefits, pensions and social care for dependent people) accounted for 20.3% of total GDP (Eurostat, 2023c) (see section 3.1 Health expenditure).
Unemployment has been a major economic and social problem since the economic and financial crisis in 2008, reaching its highest level (26%) in 2013 when more than 6 million people were jobless. These figures improved in the following years and, despite the impact of the COVID-19 crisis, in 2020 the unemployment rate kept decreasing, reaching an employment rate of 11.7% at the end of 2023. For youth employment (people aged between 15 and 24), where figures are usually above the overall unemployment rates, rates also decreased from 46.2% at the end of 2015 to 28.4% at the end of 2023 (INE, 2023b).
From a gender perspective, unemployment among women remains higher than among men, and the observed reductions in rates do not translate into reductions in the gender gap within unemployment rates; on the contrary, there was a 2.8 percentage points difference in 2015 compared to 3.5 percentage points difference in 2022 (Eurostat, 2023d).
Importantly, a new 2021 National Labour reform agreed by the government, trade unions and employers’ representatives, and aimed mainly at reducing part-time jobs, has translated into a structural change in the labour market (Royal Decree-Law 32/2021). Consequently, in 2022, Spain reached the highest number of salaried employees with permanent jobs ever, 14 250 000 people (1 591 700 more people than in 2021), and a historical minimum of salaried employees on temporary contracts, 3.1 million (1 194 000 fewer people than in 2021). In 2022, the overall temporary employment rate fell 7.5 percentage points, representing 17.9% of total employment; the reduction in the private sector was even larger, from 23.9% in 2021 to 14.8% in 2022 (Pérez-Rey & Lago Peñas, 2023).
In 2022, the median equivalized disposable income in Spain was €17 254 purchasing power standard (PPS) per inhabitant, below the EU average of €18 706 (PPS). In terms of income distribution within the country, Spain showed a Gini coefficient of 32, slightly above the EU average of 29.6 (Eurostat, 2023e).
Nevertheless, the population at risk of poverty or social exclusion has slightly decreased over the years despite the impact of the COVID-19 pandemic. The percentage of this population subgroup was 28.7% in 2015, decreased to 26% in 2022 (Eurostat, 2023f). Importantly, two legislative reforms were issued to reduce the rate of population at risk of poverty and improve their living conditions. Since 2019, the Minimum Interprofessional Wage has been adjusted annually considering the consumer price index; this measure resulted in a 22.3% increase from €736 to €900 per month in 2019; in 2023, the minimum wage reached €1080 per month (Royal Decree 1462/2018). Following a second reform, a Minimum Living Income is granted to those more disadvantaged (in terms of personal situation and economic vulnerability, as detailed in the law) (Law 19/2021). In 2023, 1.9 million people (677 150 households) benefited from the new measure (MISSM, 2023).