Spain announces 'immediate' increase of minimum wage

Spanish president Pedro Sánchez has announced an "immediate" increase of the minimum wage.

Set at €950 gross/month for full-time workers since January 2020, the measure comes following pressure from the Socialists' junior coalition partners, Unidas Podemos, as well as trade unions.

"We’re not where we were a year ago—we’re in a far better place," Sánchez said in a conference on Wednesday.

According to the unions that met with the cabinet on Wednesday, the government hopes to raise the minimum wage by €15 to €965/month by the end of the year and another €31 for each of the remaining two years of the legislature.

Government officials have not confirmed these figures, however, as negotiations are ongoing, and instead suggest that in 2021 there could be a €12 to €19 monthly increase. 

As the poverty line in Catalonia is set at €915 per month, there have been calls for a higher minimum wage, €1,239, in the region. The only administration that has the authority to set a minimum wage, however, is the Spanish government.

Despite unions welcoming the measure, business associations remain wary of any changes to the minimum wage, which rose by a record-breaking 31.8% during the first term of Sánchez’s left-wing coalition government, between 2018 and 2020. 

Business groups also argue that many companies have yet to recover from the economic downturn caused by the pandemic and could not afford to pay their employees more.