There may be more people employed in the Balearics than there were before the economic crisis, but there are also more who earn no more than 1,000 euros a month.
Data from the Tax Agency show that in 2016 there were 31,176 more employees who were paid less than a thousand euros than in 2007. Almost a half of the 497,410 salaried workers in 2016 were earning up to 983 euros; the 238,130 were receiving fourteen payments that included the two annual bonuses. The 47.8% of employees on these salary levels represented a decrease from a peak in 2014 when the percentage was 49.4%. In 2007, it had been 42% out of 493,602 workers.
More than a third of the 238,130 were earning half the minimum wage as it was in 2016. In other words they were being paid 327.60 euros per month (for fourteen months). The actual number was 79,630, which was up slightly from the 79,362 of the previous year. Workers who were paid the full minimum wage numbered 151,530, an increase over the year before.
The figures from the Tax Agency do rather back up what unions have been arguing: that economic recovery has not been matched by improved pay and conditions. The number of workers earning less than the minimum wage is an indication of part-time working. Other employees were on temporary contracts for which the lowest salaries were paid.
At the other end of the pay scale, there were 2,761 employees who earned more than 90,000 euros during 2016. This number was below the more than 4,000 who had been earning this amount in 2007.
Since the start of this year, workers in the hotel and retail sectors have seen their salaries go up because of the agreements struck last year. In the hotel sector, the rise for this year is 5%, and this will be followed by a further 5% in 2019 and then 3.5% in both 2020 and 2021. The salary agreement caught the unions and the regional government by surprise; the unions had been looking for 10% over four years. The salaries paid to hotel workers depend on job classification and the star ratings of establishments, but for the lowest paid category, the basic salary is above the 2018 minimum wage.
* Spain's national minimum wage in 2018 is 736 euros net (per month). It is set to increase to 850 euros by 2020. With regard to the salary negotiations in the hotel sector, the lowest base monthly salary (gross) for a hotel worker is at present 1,198 euros (there are various categories for which it is higher). This will increase slightly in April because the five per cent rise for 2018 has been staggered; most of it has already been applied. Based on nineteen per cent income tax, the take-home pay is therefore above the minimum wage.
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You don’t know how right you are. But whilst the un-sackable public employees in central government, local government, autonomous government, town halls, etc etc are well looked after, nothing will change.
As an employer, a serious modernisation of the paperwork/mentality system of employment is required in Spain. The system holds the country back. Also, for self employed the system is old fashioned. It is so easy for Spain to actually be the leading country of Europe if they just tweaked things.