Inequality effects of the new Spanish minimum wage


"La Caixa" Banking Foundation


  • 6 meses y 1 día
  • 2020
  • 2021


Principal Researcher: Rafael Granell
Researchers: Amadeo Fuenmayor y Teresa Savall


The minimum wage is the minimum amount that an employee can receive as remuneration for his work. This element has been since its origin a focus of debate not only in economic science, but also in the political, legal and social spheres. Its origin is located in New Zealand and Australia at the end of the 19th century. The main objective was the fight against clandestine industries that used female and child labor with very low wages, although over time it has become an element to guarantee the financial self-sufficiency of workers, regardless of their gender or age.

In the case of Spain, the minimum interprofessional salary (SMI) has increased in the 2019-2020 period by 29.1%, reaching 950 euros per month. This is the highest growth in the last 20 years and places Spain above the European average. As it is focused to workers who are in a more precarious situation, this increase has important positive effects on social welfare, reducing poverty and inequality. The most benefited groups are workers without higher education. By sectors, the increase affects especially agriculture, hospitality and commerce. By demographic profile, foreigners, youth and women are the most benefited by this increase.