Spain's Jobs Boom Is Real — But 11.6% of Workers Are Still Living in Poverty

Record Employment — But Not for Everyone

Spain's jobs market has been making headlines for all the right reasons. There are currently 22,463,300 people in work in Spain — a record high — and the unemployment rate has fallen to 9.93%, its lowest level since the 2008 financial crisis. Permanent contracts have also increased significantly following the 2021 labour reform, with 16 million workers now in stable employment.

But behind those impressive headline figures lies a considerably more complicated picture — one that new data is making increasingly hard to ignore.

Third Worst in Europe for In-Work Poverty

Despite record employment, 11.6% of workers in Spain are at risk of poverty. That places Spain as the third worst country in the European Union for in-work poverty, behind only Luxembourg and Bulgaria — and well above the EU average of 8.2%.

The latest FOESSA Report 2025 — one of Spain's most authoritative studies on social exclusion — goes further, finding that job insecurity affects 47.5% of the Spanish workforce, around 11.5 million people. This encompasses not only those earning below the poverty line, but also workers on unstable contracts or insufficient hours.

Sociologist Daniel Rodríguez, one of the report's authors, points to the persistent problem of involuntary part-time work as a key driver: even as temporary contracts have declined, many workers remain locked into part-time hours they did not choose and cannot increase.

Who Is Being Left Behind?

The data reveals that the gap between Spain's headline employment figures and the lived reality of many workers falls most heavily on three groups:

Women

Women make up 76.3% of part-time workers in Spain, and around 20.5% of part-time workers are considered poor. Many cite caring responsibilities as the barrier: 12% of women say they cannot increase their working hours due to housework or family care, compared to just 4% of men. Female unemployment also remains significantly higher than male unemployment — 11.24% versus 8.76%.

Young People

Young workers face what economists call a "scarring effect": entering the labour market on lower wages than previous generations can suppress earnings for decades. "They are entering the labour market with lower salaries than previous generations," says Rodríguez. The financial insecurity is also taking a mental health toll — 40.6% of young people link physical or psychological problems to economic instability.

Migrant Workers

Foreign workers face an unemployment rate of 15.79% — significantly above the national average — and those who do find work often have little choice about the conditions they accept. "They have to take whatever work comes their way, regardless of whether the conditions are decent or not," says Rodríguez.

Wages Falling Behind in Real Terms

Low pay is another key part of the picture. In 2022, 18.8% of workers earned below the poverty threshold identified by researchers. While wages have risen in nominal terms in recent years, they have not kept pace with inflation — meaning that in real terms, salaries are still 4.2% lower than they were in early 2021.

"When compared to the cost of living, these increases have been very small," says Rodríguez.

A Recovery That Isn't Reaching Everyone

The picture that emerges from the data is of a labour market that is genuinely improving on paper — but one that is still leaving a significant share of its workers behind. Experts are increasingly calling for employment policies to be linked more explicitly with housing support and social services, rather than treating job creation as an end in itself.

As Víctor García from the European Anti-Poverty Network in Spain puts it: "It is important that active employment policies target the groups of people facing the greatest difficulties."

Spain's jobs boom is real. But for nearly one in eight workers, a job is not yet enough to escape poverty.

This article is based on reporting from Spanish News Today, published April 1, 2026, drawing on the FOESSA Report 2025 and official labour market data. This article is for informational purposes only.