The promised minimum wage rise will be enshrined in law later this month, the government has announced – and will see an increase in monthly payments for over 6.3 million residents in Spain.
As at the beginning of this year, a total of 34.7% of employees in Spain were earning the minimum wage or less, out of the total of 18.3 million who are in jobs on contracts, as opposed to self-employed.
This translates to an increase in minimum-wage earners of 1.1 million in a decade, despite the number of employees having fallen by a million in that time.
Of those 6.3 million, the average income is around €7,400 a year.
At present, the minimum wage for a full-time, 40-hour working week is €735.90 per month over 14 months – based upon the gradually-declining system of a double wage packet at Christmas and in August, which is rarely seen outside the public sector – being €10,302.60 a year or, in 12 monthly payments, €858.55.
As the income tax threshold starts at €12,000, these amounts are net, as well as gross.
Before this month is out, the minimum wage will rise officially to €900 in 14 monthly payments, equating to €12,600, or €1,050 in 12 monthly payments.
It is not clear whether this is the net or the gross figure, but assuming it is the latter, the average worker earning the new minimum wage will take home €964.50 a month if they receive 12 salaries a year rather than 14.
Spain's government believes this will ease the financial pressure suffered by the lowest-earning households, and will also increase tax and Social Security (National Insurance) income for the State, as well as spending in general, which will eventually lead to more jobs being created.
Read more at thinkSPAIN.com