Editing Economy of Spain (section)

==History==
{{Main|Economic history of Spain}}
[[File:GPD per capita development of Spain.jpg|thumb|300x300px|right|Real GDP per capita development Spain]]

During the first decades of the twentieth century, Spain experienced an accelerated growth of its industrial labor force and urban population; the economy became less agrarian as the process of urbanization spread after 1910. The largest sector was still [[agriculture in Spain|agriculture]] but saw declines, along with fishery, relative to the share of active population engaged in the activity. The fastest growing sector at that time was services.<ref>{{cite book |last1=Payne |first1=Stanley G. |title=The Collapse of the Spanish Republic 1933-1936 |date=2006 |publisher=Yale University Press |location=United States}}</ref>

When Spain joined the [[EEC]] in 1986 its [[GDP per capita]] was about 72% of the average of its members.<ref name="ReferenceA">{{Cite news|url=http://economia.elpais.com/economia/2014/06/18/actualidad/1403088531_554197.html|title = La renta por habitante española retrocede 16 años en comparación con la UE|newspaper = El País|date = 18 June 2014|last1 = Pérez|first1 = Claudi}}</ref>

At the second half of the 1990s, the conservative government of former prime minister [[José María Aznar|Jose María Aznar]] had worked successfully to gain admission to the group of countries joining the [[euro]] in 1999. By the mid-1990s the economy had commenced the growth that had been disrupted by the global recession of the early 1990s. The strong economic growth helped the government to reduce the government debt as a percentage of GDP and Spain's high unemployment rate began to steadily decline. With the government budget in balance and inflation under control Spain was admitted into the eurozone in 1999. By 2007, Spain had achieved a GDP per capita of 105% of European Union's average due to its own economic development and the [[EU enlargement]]s to 28 members, which placed it slightly ahead of Italy (103%). Three regions were included in the leading EU group exceeding 125% of the GDP per capita average level: [[Basque Country (autonomous community)|the Basque Country]], [[Community of Madrid|Madrid]], and [[Navarre]].<ref>Login required – [http://epp.eurostat.ec.europa.eu/pls/portal/docs/PAGE/PGP_PRD_CAT_PREREL/PGE_CAT_PREREL_YEAR_2007/PGE_CAT_PREREL_YEAR_2007_MONTH_02/1-19022007-EN-AP.PDF Eurostat 2004 GDP figures] {{webarchive|url=https://web.archive.org/web/20090326210729/http://epp.eurostat.ec.europa.eu/pls/portal/docs/PAGE/PGP_PRD_CAT_PREREL/PGE_CAT_PREREL_YEAR_2007/PGE_CAT_PREREL_YEAR_2007_MONTH_02/1-19022007-EN-AP.PDF |date=26 March 2009 }}</ref> According to calculations by the German newspaper ''[[Die Welt]]'' in 2008, Spain's economy had been on course to overtake countries like Germany in per capita income by 2011.<ref>{{Citation|url=http://www.europeanfoundation.org/docs/id210.pdf |title=No camp grows on both Right and Left |publisher=European Foundation Intelligence Digest |access-date=9 August 2008 |url-status=dead |archive-url=https://web.archive.org/web/20080819191609/http://www.europeanfoundation.org/docs/id210.pdf |archive-date=19 August 2008}}</ref> in October 2006, Unemployment stood at 7.6% which compared favorably to many other European countries, and especially with the early 1990s when it stood at over 20%. In the past, Spain's economy had included high inflation<ref>{{cite web|url=http://www.oecdobserver.org/news/fullstory.php/aid/1592/Spain%92s_economy_.html|title=Spain's Economy: Closing the Gap|publisher=[[OECD]] Observer|date=May 2005|access-date=15 August 2008}}</ref> and it has always had a large [[underground economy]].<ref>{{Citation|url=http://www.oecd.org/dataoecd/51/21/37392840.pdf|title=OECD report for 2006|access-date=9 August 2008|publisher=OECD}}</ref>

The turn to growth during the 1997-2007 period produced a [[real estate bubble]] fed by historically low interest rates, massive rates of foreign investment (during that period Spain had become a favorite of other European investment banks) and an immense surge in immigration. At its peak in 2007, construction had expanded to 15% of the total gross domestic product (GDP) of the country and 12% of total employment. During that time Spain capital inflows –including short term speculative investment–  financed a large trade deficit.<ref name="ReferenceA" />

The downside of the real estate boom was a corresponding rise in the levels of private debt, both of households and of businesses; as prospective homeowners had struggled to meet asking prices, the average level of [[household debt]] tripled in less than a decade. This placed especially great pressure upon lower to middle income groups; by 2005 the median ratio of indebtedness to income had grown to 125%, due primarily to expensive boom time mortgages that now often exceed the value of the property.<ref>{{Citation|url=http://www.bde.es/informes/be/boleco/2005/be0507e.pdf |title=Bank of Spain Economic Bulletin 07/2005 |format=PDFaugest 588 |publisher=Bank of Spain |url-status=dead |archive-url=https://web.archive.org/web/20080819191608/http://www.bde.es/informes/be/boleco/2005/be0507e.pdf |archive-date=19 August 2008 |df=dmy }}</ref>

Noticeable progress continued until early 2008, when the [[2008 financial crisis]] burst Spain's property bubble.<ref name=CIASpain>{{Citation|title=Spain (Economy section)|url=https://www.cia.gov/the-world-factbook/countries/spain/ |work=[[The World Factbook]] |publisher=[[CIA]] |date=23 April 2009 |access-date=1 May 2009 |quote=GDP growth in 2008 was 1.3%, well below the 3% or higher growth the country enjoyed from 1997 through 2007. }}</ref>

A European Commission forecast had predicted Spain would enter the world's [[late 2000s recession]] by the end of 2008.<ref>{{Citation|url=http://www.ft.com/cms/s/0/cf5d0f08-7f49-11dd-a3da-000077b07658.html?nclick_check=1|title=Recession to hit Germany, UK and Spain|work=[[Financial Times]]|date=10 September 2008|access-date=11 September 2008}}</ref> At the time, Spain's Economy Minister was quoted saying, "Spain is facing its deepest recession in half a century".<ref>{{Cite web|title=Hashtag Spain|url=https://www.hashtagspain.com/|access-date=2022-01-11|website=Hashtag Spain|language=en-US}}</ref> Spain's government forecast the unemployment rate would rise to 16% in 2009. The [[ESADE]] business school predicted 20%.<ref>{{Cite news|date=2009-01-22|title=And worse to come|newspaper=The Economist|url=https://www.economist.com/europe/2009/01/22/and-worse-to-come|access-date=2022-01-11|issn=0013-0613}}</ref> By 2017, Spain's GDP per capita had fallen back to 95% of the European Union's average.<ref name="ReferenceA" />

===2008–2014 Spanish financial crisis===
{{update|section|date=June 2024}}
{{Main|2008–2014 Spanish financial crisis}}
Like most economies, Spain's economy had been steadily growing, regardless of political changes e.g. when the [[Spanish general election, 2004|ruling party changed in 2004]]. It maintained robust growth during the first term of prime minister [[José Luis Rodríguez Zapatero]], even though problems were becoming evident. According to the ''[[Financial Times]]'', Spain's rapidly growing [[Balance of trade|trade deficit]] had reached 10% of GDP by summer 2008,<ref name="Abellán2008">{{Citation
 | last = Abellán | first = L.
 | date = 30 August 2008 | access-date = 2 May 2009
 | title = El tirón de las importaciones eleva el déficit exterior a más del 10% del PIB
 | periodical = [[El País]] | series = Economía | language = es | place = Madrid
 | url = http://www.elpais.com/articulo/economia/tiron/importaciones/eleva/deficit/exterior/PIB/elpepueco/20080830elpepieco_3/Tes
}}</ref> the "loss of competitiveness against its main trading partners" and as a part of the latter, inflation which had been traditionally higher than its European competitors. This was especially affected by house price increases of 150% from 1998 and growing private sector indebtedness (115%), chiefly related to the [[Spanish property bubble|Spanish Real Estate boom]] and rocketing oil prices.<ref name=Crawford2006>{{Citation
 | last = Crawford | first = Leslie
 | date = 8 June 2006 | title = Boomtime Spain waits for the bubble to burst
 | url = http://www.ft.com/cms/s/0/32cd35d0-f68b-11da-b09f-0000779e2340.html?nclick_check=1
 | periodical = [[Financial Times]] | series = Europe | place = Madrid | issn = 0307-1766
}}</ref>

In April 2008, the Spanish government growth forecast was 2.3%, but this was revised down by the Ministry of Economy to 1.6%.<ref name=Europa2008>{{Citation
 | last = Europa Press | year = 2008 | publication-date = 31 October 2008
 | title = La economía española retrocede un 0.2% por primera vez en 15 años | language = es
 | url = http://www.elpais.com/articulo/economia/economia/espanola/retrocede/primera/vez/anos/elpepueco/20081031elpepueco_8/Tes
 | periodical = El País | place = Madrid
}}</ref> Studies by independent forecasters estimated it had actually dropped to 0.8%,<ref>{{Citation 
 |author=Economist Intelligence Unit 
 |title=Spain Economic Data 
 |url=https://www.economist.com/countries/Spain/profile.cfm?folder=Profile-Economic%20Data 
 |archive-url=https://web.archive.org/web/20090420194847/http://www.economist.com/Countries/Spain/profile.cfm?folder=Profile-Economic%20Data 
 |work=Country Briefings 
 |publisher=The Economist 
 |date=28 April 2009 
 |access-date=2 May 2009 
 |archive-date=20 April 2009 
 |url-status=dead
 }}</ref> below the strong 3% plus growth rates during 1997–2007. During Q3 of 2008 the GDP contracted for the first time in 15 years. In February 2009, it was confirmed that Spain, along other European economies, had entered [[recession]].<ref name=Day2009>{{Citation
 | last1 = Day | first1 = Paul | last2 = Reuters | date = 18 February 2009 | access-date = 2 May 2009
 | title = UPDATE 1 – Spain facing long haul as recession confirmed | periodical = Forbes | place = Madrid
 | url = https://www.forbes.com/feeds/afx/2009/02/18/afx6064245.html|archive-url=https://web.archive.org/web/20090610212457/http://www.forbes.com/feeds/afx/2009/02/18/afx6064245.html|archive-date=10 June 2009}}</ref>
[[File:Spanish Provinces by Gini Coefficient, 2021.png|thumb|300x300px|Spanish Provinces by Gini Coefficient, 2021{{Legend-col|{{legend|#d5e5ff|28-28.9}}|{{legend|#AACCFF|29-29.9}}|{{legend|#80B3FF|30-30.9}}|{{legend|#2A7FFF|31-31.9}}|{{legend|#0066FF|32-32.9}}|{{legend|#0055D4|33-33.9}}|{{legend|#0044aa|34-35.9}}
}}]]
In July 2009, the IMF worsened the estimates for Spain's 2009 contraction, to -4% of GDP, close to the European average of -4.6%. It estimated a further 0.8% contraction for Spain, in 2010.<ref>{{cite web |url=http://www.finanzas.com/noticias/economia/2009-07-08/182608_empeora-pronosticos-economia-espanola.html |title=FMI empeora sus pronósticos de la economía española |publisher=Finanzas.com |date=8 July 2009 |access-date=20 November 2012 |archive-url=https://web.archive.org/web/20130726034546/http://www.finanzas.com/noticias/economia/2009-07-08/182608_empeora-pronosticos-economia-espanola.html |archive-date=26 July 2013 |url-status=dead }}</ref>
In 2011, the deficit reached a high of 8.5%. For 2016 the deficit objective of the government was around 4%, falling to 3% for 2017. The [[European Commission]] demanded 4% for 2016 and 2.5% for 2017.<ref name =elpais2016>{{cite news |title=Spain's deficit: Spain rejects EU deficit reprisals, insisting economy will grow above 3% this year |date=19 July 2016 |first1=Javier |last1=Casqueiro|work=El País |url=http://elpais.com/elpais/2016/07/18/inenglish/1468833881_669832.html |access-date=27 August 2016}}</ref>

==== Property boom and bust, 2003–2014 ====
{{Main|Spanish property bubble|2008–2014 Spanish real estate crisis}}

The adoption of the euro in 2002 had driven down long-term interest rates, prompting a surge in mortgage lending that jumped fourfold from 2000 to its 2010 apex.<ref name="housingcrash">{{Cite news|url=https://www.bloomberg.com/news/articles/2016-11-29/spanish-millennials-spurn-owning-homes-as-they-shift-to-rentals|title=Housing Crash Turns Spain's Young into Generation Rent|work=Bloomberg |access-date=29 November 2016 | first1=María | last1=Tadeo | first2=Sharon R.| last2=Smyth| date=29 November 2016}}</ref> The growth in the property market, which had begun in 1997, accelerated and within a few years had developed into a [[Spanish property bubble|property bubble]]. It was financed largely by "Cajas", which are regional savings banks under the oversight of regional governments, and was fed by the historically low interest rates and a massive growth of immigration. Fueling this trend, the economy was being credited for having avoided the almost zero of some of its largest partners in the EU, in the months previous to the global [[Great Recession]].<ref>{{cite web|url=http://stats.oecd.org/WBOS/ViewHTML.aspx?QueryName=198&QueryType=View&Lang=en|title=OECD figures|publisher=OECD|access-date=13 August 2008|archive-date=9 May 2008|archive-url=https://web.archive.org/web/20080509001824/http://stats.oecd.org/WBOS/ViewHTML.aspx?QueryName=198&QueryType=View&Lang=en|url-status=dead}}</ref>

Over the five years ending 2005, Spain's economy had created more than half of all new jobs in the EU.<ref>{{Cite news|url=https://www.theguardian.com/world/2006/jul/26/spain.gilestremlett|title=Economic statistics|work=The Guardian|location=London |access-date=13 August 2008 | first=Giles | last=Tremlett | date=26 July 2006}}</ref><ref>{{cite web|url=http://www.la-moncloa.es/NR/rdonlyres/2E85E75E-E2D9-4148-B1DF-950B06696A6C/74823/Chapter_2.PDF |title=Official report on Spanish recent Macroeconomics, including tables and graphics |access-date=13 August 2008 |publisher=La Moncloa |url-status=dead |archive-url=https://web.archive.org/web/20080726044742/http://www.la-moncloa.es/NR/rdonlyres/2E85E75E-E2D9-4148-B1DF-950B06696A6C/74823/Chapter_2.PDF |archive-date=26 July 2008 }}</ref> At the top of its property boom, Spain was building more houses than Germany, France and the UK combined.<ref name="housingcrash"/> Home prices soared by 71% between 2003 and 2008, in tandem with the credit explosion.<ref name="housingcrash"/>

The bubble imploded in 2008, causing the collapse of Spain's large property related and construction sectors, causing mass layoffs, and a collapsing domestic demand for goods and services. Unemployment shot up. At first, Spain's banks and financial services avoided the early crisis of their international counterparts. However, as the recession deepened and property prices slid, the growing bad debts of the smaller regional savings banks, forced the intervention of Spain's central bank and government through a stabilization and consolidation program, taking over or consolidating regional ''"cajas"'', and finally receiving a bank bailout from the [[European Central Bank]] in 2012, aimed specifically for the banking business and "''cajas"'' in particular.<ref>{{Cite news|last1=Minder|first1=Raphael|last2=Kanter|first2=James|date=2012-11-28|title=Spanish Banks Agree to Layoffs and Other Cuts to Receive Rescue Funds in Return|language=en-US|work=The New York Times|url=https://www.nytimes.com/2012/11/29/business/global/european-commission-approves-bailout-of-four-spanish-banks.html|access-date=2022-01-11|issn=0362-4331}}</ref><ref>{{cite news|author=Giles Tremlett in Madrid |url=https://www.theguardian.com/world/2012/jun/08/spain-savings-banks-corruption |title=The Guardian, Spain's savings banks' 8 June 2012 |newspaper=The Guardian|date= 8 June 2012|access-date=26 April 2013 |location=London}}</ref><ref>{{cite news |last=Mallet |first=Victor |url=http://www.ft.com/cms/s/0/d8411cf6-bb89-11e1-90e4-00144feabdc0.html#axzz2GDPWPST5 |archive-url=https://ghostarchive.org/archive/20221210211222/https://www.ft.com/content/d8411cf6-bb89-11e1-90e4-00144feabdc0#axzz2GDPWPST5 |archive-date=10 December 2022 |url-access=subscription |title=The bank that broke Spain Financial Times |newspaper=Financial Times |publisher=Ft.com |date=21 June 2012 |access-date=26 April 2013 |url-status=live }}</ref> Following the 2008 peak, home prices plunged by 31%, before bottoming out in late 2014.<ref name="housingcrash"/>

====Euro debt crisis, 2010-2012====
{{Main|European debt crisis}}
[[File:Spain bond rates.webp|thumb|300px|Spain bond rates during the [[2008–2014 Spanish financial crisis]]
{{legend-line|#F1BF00 solid 3px|20 year bond}}
{{legend-line|#AA151B solid 3px|10 year bond}}
{{legend-line|#00A2FF solid 3px|2 year bond}}
{{legend-line|#EE220C solid 3px|3 month bond}}
]]
[[File:Eurozone.svg|thumb|Spain is part of a monetary union, the [[eurozone]] (dark blue), and the [[European single market]]. ]]
In the first weeks of 2010, renewed anxiety about excessive debt in some EU countries and, more generally, about the health of the euro spread from Ireland and Greece to Portugal, and to a lesser extent Spain. Many economists recommended a battery of policies to control the surging public debt caused by the recessionary collapse of tax revenues, combining drastic austerity measures with higher taxes. Some German policymakers went as far as to say that bailouts should include harsh penalties to EU aid recipients, such as Greece.<ref>{{in lang|en}} {{Citation |url=http://www.businessweek.com/news/2010-02-15/merkel-economy-adviser-says-greece-bailout-should-bring-penalty.html |access-date=15 February 2010 |title=Merkel Economy Adviser Says Greece Bailout Should Bring Penalty |url-status=dead |archive-url=https://web.archive.org/web/20100219060101/http://www.businessweek.com/news/2010-02-15/merkel-economy-adviser-says-greece-bailout-should-bring-penalty.html |archive-date=19 February 2010}}</ref> The Spanish government budget was in surplus in the years immediately before the [[Great Recession]], and its debt was not considered excessive.

At the beginning of 2010, Spain's public debt as a percentage of GDP was still less than those of Britain, France or Germany. However, commentators pointed out that Spain's recovery was fragile, that the public debt was growing quickly, troubled regional banks may need large bailouts, growth prospects were poor and therefore limiting revenue, and that the central government had limited control over the spending of the regional governments. Under the structure of shared governmental responsibilities that has evolved since 1975, much responsibility for spending had been given back to the regions. The central government found itself in the position of trying to gain support for unpopular spending cuts from the recalcitrant regional governments.<ref>{{cite news|last=Ross |first=Emma |url=https://www.bloomberg.com/apps/news?pid=20601109&sid=anieTsqbl2DM&pos=13 |title=Zapatero's Bid to Avoid Greek Fate Hobbled by Regions|publisher=Bloomberg.com |date=18 March 2010 |access-date=20 November 2012}}</ref> In May 2010, the government announced further austerity measures, consolidating the ambitious plans announced in January.<ref>[https://news.yahoo.com/s/afp/20100523/ts_afp/financeeconomyspainpoliticsstrike_20100523202827] {{dead link|date=June 2016|bot=medic}}{{cbignore|bot=medic}}</ref>

As of September 2011, Spanish banks held a record high of €142 billion of Spanish national bonds. Till Q2 2012, Spanish banks were allowed to report real estate related assets in higher non-market price by regulators. Investors who bought into such banks must be aware. Spanish houses cannot be sold at land book value after being vacant over a period of years.{{citation needed|date=March 2022}}

====Employment crisis====
[[File:Torres de la Casería.jpg|thumb|[[Torres de la Casería de Ossio]] apartment buildings in [[San Fernando, Cádiz|San Fernando]] completed in 2007. The collapse of the Spanish construction boom was a major contributor to the record unemployment.<ref name=BBC2009joblessrate>{{Citation
 | publication-date = 24 April 2009 | access-date = 2 May 2009
 | title = Spain's jobless rate soars to 17%
 | periodical = BBC America | series = Business | publisher = BBC News
 | url = http://news.bbc.co.uk/1/hi/business/8016364.stm
 | date=24 April 2009}}</ref>]]

After having completed large improvements over the second half of the 1990s and during the 2000s, Spain attained in 2007 its record low unemployment rate, at about 8%,<ref name="EPA El País">{{cite news| url=http://elpais.com/elpais/2016/01/28/media/1453977771_957921.html?rel=mas |work= El País | title= EPA: Evolución del mercado laboral en España | date=28 January 2016}}</ref> with some regions on the brink of [[full employment]]. Then Spain suffered a severe setback from October 2008, when it saw its unemployment rate surge. Between October 2007 – October 2008 the surge exceeded that of past economic crises, including 1993. In particular, during October 2008, Spain suffered its worst unemployment rise ever recorded.<ref name=ElPais20081104>{{Citation
 | last = Agencias | date = 4 November 2008 | access-date = 2 May 2009
 | title = La recesión económica provoca en octubre la mayor subida del paro de la historia
 | periodical = El País | series = Internacional | place = Madrid | language = es
 | url = http://www.elpais.com/articulo/internacional/recesion/economica/provoca/octubre/mayor/subida/paro/historia/elpepuint/20081104elpepuint_8/Tes
}}</ref><ref>{{Citation
 | date = 4 December 2008 | access-date = 2 May 2009
 | title = Builders' nightmare | newspaper = The Economist | series = Europe | place = Madrid
 | url = https://www.economist.com/world/europe/displaystory.cfm?story_id=12725415
}}</ref>
Even though the sheer size of Spain's underground economy masked the real situation, employment has been a long term weakness of the economy. By 2014 the [[structural unemployment]] rate was estimated at 18%.<ref name="economist.com">{{cite news| url=https://www.economist.com/news/europe/21610330-labour-market-recovering-last-it-needs-further-reform-iberian-dawn | newspaper=The Economist | title=Iberian_Dawn | date=2 August 2014}}</ref>
By July 2009, Spain had shed 1.2 million jobs in one year.<ref>{{cite news| url=https://www.economist.com/world/europe/displaystory.cfm?story_id=14006703 | newspaper=The Economist | title=Two-tier flexibility | date=9 July 2009}}</ref> The oversized building and housing related industries were contributing greatly to the rising unemployment.<ref name="BBC2009joblessrate"/> From 2009 thousands of established immigrants began to leave, although some did maintain residency due to poor conditions in their country of origin.<ref name="González2009">{{Citation | last = González | first = Sara | date = 1 May 2009 | access-date = 14 May 2009 | title = 300.000 inmigrantes han vuelto a su país por culpa del paro | language = es | periodical = El Periódico de Catalunya | series = Sociedad | place = Barcelona | publisher = Grupo Zeta | url = http://www.elperiodico.com/default.asp?idpublicacio_PK=46&idioma=CAS&idnoticia_PK=608508&idseccio_PK=1021 | archive-url = https://web.archive.org/web/20100516235135/http://www.elperiodico.com/default.asp?idpublicacio_PK=46&idioma=CAS&idnoticia_PK=608508&idseccio_PK=1021 | url-status = dead | archive-date = 16 May 2010}}</ref> In all, by early 2013 Spain reached an unprecedented unemployment record at about 27%.<ref name="EPA El País"/>

In 2012 a radical labor reform made for a more [[labour market flexibility|flexible labor market]], facilitating layoffs with a view to enhancing business confidence.<ref name=cincodias>{{Cite web|url=http://cincodias.com/cincodias/2014/07/23/economia/1406138437_308198.html|title=EPA: El paro cae al 24,47% con el primer aumento anual de ocupación desde 2008|date=24 July 2014}}</ref>

===== Youth =====
During the early 1990s, Spain experienced economic crisis as a result of a Europe-wide economic episode that led to a rise in unemployment. Many young adults found themselves trapped in a cycle of temporary jobs, which resulted in the creation of a secondary class of workers through reduced wages, job stability and advancement opportunities.<ref>{{Cite journal|last1=García-Pérez|first1=J. Ignacio|last2=Muñoz-Bullón|first2=Fernando|date=2011-03-01|title=Transitions into Permanent Employment in Spain: An Empirical Analysis for Young Workers|journal=British Journal of Industrial Relations|language=en|volume=49|issue=1|pages=103–143|doi=10.1111/j.1467-8543.2009.00750.x|issn=1467-8543|citeseerx=10.1.1.597.6996|s2cid=154392095}}</ref> As a result, many Spaniards, predominantly unmarried young adults, emigrated to pursue job opportunities and raise their quality of life,<ref>{{Cite journal|last1=Domínguez-Mujica|first1=Josefina|last2=Guerra-Talavera|first2=Raquel|last3=Parreño-Castellano|first3=Juan Manuel|date=2014-12-01|title=Migration at a Time of Global Economic Crisis: The Situation in Spain|journal=International Migration|language=en|volume=52|issue=6|pages=113–127|doi=10.1111/imig.12023|issn=1468-2435}}</ref> which left only a small amount of young adults living below the poverty line.<ref>{{Cite journal|last=Ayllón|first=Sara|date=2015-12-01|title=Youth Poverty, Employment, and Leaving the Parental Home in Europe|journal=Review of Income and Wealth|language=en|volume=61|issue=4|pages=651–676|doi=10.1111/roiw.12122|s2cid=153673821|issn=1475-4991}}</ref> Spain experienced another economic crisis during the 2000s, which also prompted a rise in emigration to neighboring countries with more job stability and better economic standing.<ref>{{Cite journal|last1=Ahn|first1=Namkee|last2=De La Rica|first2=Sara|last3=Ugidos|first3=Arantza|date=1999-08-01|title=Willingness to Move for Work and Unemployment Duration in Spain|journal=Economica|language=en|volume=66|issue=263|pages=335–357|doi=10.1111/1468-0335.00174|issn=1468-0335|url=https://www.cemfi.es/ftp/wp/9801.pdf}}</ref>

Youth unemployment remains a concern, prompting suggestions of labor market programs and job-search assistance like matching youth skills with businesses. This would improve Spain's weakened youth labor market, and their school to work transition, as young people have found it difficult to find long-term employment.<ref>{{Cite journal|url=http://www.oecd-ilibrary.org/economics/improving-employment-prospects-for-young-workers-in-spain_5k487n7hg08s-en|doi = 10.1787/5k487n7hg08s-en|title = Improving Employment Prospects for Young Workers in Spain|series = OECD Economics Department Working Papers|year = 2013|last1 = Wölfl|first1 = Anita|doi-access = free}}</ref> As of January 2025, the youth unemployment in Spain stands at 24.9%.<ref name=unemployment2024>{{cite web|title=Economically Active Population Survey. Fourth Quarter 2024.|url=https://www.ine.es/dyngs/INEbase/en/operacion.htm?c=Estadistica_C&cid=1254736176918&menu=ultiDatos&idp=1254735976595|website=INE Instituto Nacional de Estadística |access-date=29 January 2025}}</ref>

=====Employment recovery=====
The labor market reform started a trend of setting successive positive employment records. By Q2 of 2014, the economy had reversed its negative trend and started creating jobs for the first time since 2008.<ref name=cincodias/> The second quarter reversal had been extraordinary; jobs created set an absolute positive record since such quarterly employment statistics began in 1964.<ref>{{Cite web|url=http://www.europapress.es/economia/laboral-00346/noticia-economia-epa-paro-registra-caida-record-310400-personas-crean-402400-empleos-mayor-cifra-anos-20140724090006.html|title = El paro registra una caída récord de 310.400 personas y se crean 402.400 empleos, la mayor cifra en 9 años|date = 24 July 2014}}</ref> Labor reform did seem to play an important role; one piece of evidence cited was that Spain had started creating jobs at lower rates of GDP growth than before: in previous cycles, employment rose when growth hit 2%, this time the gain came during a year when GDP had expanded by just 1.2%.<ref name="economist.com"/>

Greater than expected GDP growth paved the way for further decline in unemployment. Since 2014, Spain registered steady annual falls in the official jobless figure. During 2016, unemployment experienced the steepest fall on record.<ref name="FTbiggestdrop"/> By the end of 2016, Spain had recovered 1.7m of the more than 3.5m jobs lost over the recession.<ref name="FTbiggestdrop"/> By Q4 2016 Spanish unemployment had fallen to 19%, the lowest rate in seven years.<ref name="unemployment Q4'16">{{cite news| author=Maria Tadeo| url=https://www.bloomberg.com/news/articles/2017-01-26/spain-unemployment-falls-to-seven-year-low-as-rajoy-seeks-budget | work=Bloomberg | title=Spain Unemployment Falls to Seven-Year Low Amid Budget Talks | date=26 January 2017}}</ref> In April 2017 the country recorded its biggest drop in jobless claimants for a single month to date.<ref>{{cite news| url=http://elpais.com/elpais/2017/05/04/inenglish/1493884808_621515.html | work=El País | title=Jobs in Spain: Easter hirings bring record monthly drop in unemployment to Spain | date=4 May 2017}}</ref><ref name="May '17 employment">{{cite news| url=http://elpais.com/elpais/2017/06/02/inenglish/1496389957_165086.html | work=El País | title=Working in Spain: Unemployment: Social Security affiliations have best May since 2001 | date=2 June 2017}}</ref> In Q2 of 2017, unemployment fell to 17%, below 4 million for the first time since 2008,<ref>{{cite news| author=María Tadeo| url=https://www.bloomberg.com/news/articles/2017-07-27/spanish-unemployment-falls-to-lowest-since-start-of-2009-chart  | work=Bloomberg | title=Spanish Unemployment Falls to Lowest Since Start of 2009 | date=27 July 2017}}</ref> with the country experiencing its steepest quarterly decline in unemployment on record.<ref>{{cite news| author=Antonio Maqueda| url=https://economia.elpais.com/economia/2017/07/27/actualidad/1501137604_444180.html | work=El País | title=EPA: El paro baja de los cuatro millones por primera vez desde comienzos de 2009 | date=27 July 2017| language=es}}</ref> In 2018, at 14.6% the unemployment rate did not exceed the 15% threshold for the first time since 2008 when the crisis began.<ref>{{cite news| author=Manuel V. Gómez| url=https://elpais.com/economia/2018/10/25/actualidad/1540447599_036822.html | work=El País | title=EPA: La tasa de paro baja del 15% por primera vez desde 2008 | date=25 October 2018| language=es}}</ref>

As of 2017, trade unions, left, and center-left parties continued to criticize and wanted labor reform to be revoked, on grounds that it tilted the balance of power too far towards employers.<ref name="FTbiggestdrop">{{cite news| author=Tobias Buck| url=https://www.ft.com/content/f673c81c-d27d-11e6-b06b-680c49b4b4c0 |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/f673c81c-d27d-11e6-b06b-680c49b4b4c0 |archive-date=10 December 2022 |url-access=subscription  | work=Financial Times | title=Drop in Spanish jobless total is biggest on record | date=4 January 2017}}</ref> Most new contracts were temporary.<ref name="May '17 employment"/> In 2019, [[Pedro Sánchez (politician)|Pedro Sánchez]]'s socialist government increased the minimum wage by 22% in an attempt to boost hiring and encourage spending, and increased it further in the labor reform adopted at the end of 2021. Members of the opposition argued this increase, would negatively affect 1.2 million workers due to employers being unable to cover the raise, resulting in higher unemployment.<ref>{{cite web|url=https://www.bloomberg.com/news/articles/2019-02-10/spain-takes-an-economic-gamble-on-an-unprecedented-wage-hike|title=Spain Takes an Economic Gamble on an Unprecedented Wage Hike|access-date=9 February 2019|publisher=Bloomberg}}</ref> Contrary to such opinion, the reforms approved by Sanchez's government resulted in a robust shift towards permanent employment contracts, and led to a 15-year low in unemployment rates at 11.60%.<ref>{{Cite web |title=Spain: Keeping good momentum |url=https://www.allianz-trade.com/en_global/economic-research/country-reports/Spain.html |access-date=2024-08-09 |website=Corporate |language=en}}</ref>

====Reduction of European Union funds====
Capital contributions from the EU, which had contributed significantly to the economic empowerment of Spain since joining the EEC, have decreased considerably since 1990, due to the effects of the EU's enlargement. Agricultural funds from the Common Agricultural Policy of the European Union (CAP) are now spread across more countries. And, with [[2004 enlargement of the European Union|2004]] and [[2007 enlargement of the European Union|2007]]'s [[enlargement of the European Union]], less developed countries joined, lowering average income, so that Spanish regions which had been relatively less developed, were now at the European average or even above it. Spain has gradually become a net contributor of funds for less developed countries of the Union, as opposed to receiving funds.<ref>{{cite web|url=http://www.publico.es/dinero/446365/espana-elige-el-peor-momento-para-ingresar-en-el-club-de-los-paises-ricos |title=España elige el peor momento para ingresar en el club de los países ricos|date=24 November 2012 |publisher=Publico.es |access-date=13 March 2013}}</ref>

==== Economic recovery (2014–2020) ====
During the economic downturn, Spain significantly reduced imports, increased exports and attracted growing numbers of tourists; as a result, after three decades of running a [[trade deficit]] the country attained in 2013 a [[trade surplus]]<ref name="economia.elpais.com"/> which strengthened during 2014–15.<ref name="ReferenceB"/>

With a 3.2% increase in 2015, growth was the highest among larger EU economies.<ref name="reuters.com"/> In two years (2014–2015) the economy had recovered 85% of the GDP lost during the 2009-2013 recession,<ref name="RazónEspañarecuperaPIB">{{cite web|url=http://www.larazon.es/economia/espana-recupera-en-solo-dos-anos-el-85-del-pib-perdido-durante-la-crisis-EA10988729#.Ttt1ubIu49EsOLK |title=España recupera en sólo 2 años el 85% del PIB perdido durante la crisis |publisher=La Razón |date=17 October 2015 |access-date=15 June 2016|language=es}}</ref> which had some international analysts referring to Spain's recovery as "the showcase for structural reform efforts".<ref name="TelegraphSpainSuperstar">{{Cite web|url=https://www.telegraph.co.uk/finance/economics/11574536/How-Spain-became-the-Wests-superstar-economy.html |archive-url=https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/economics/11574536/How-Spain-became-the-Wests-superstar-economy.html |archive-date=12 January 2022 |url-access=subscription |url-status=live|title = How Spain became the West's superstar economy|date=30 April 2015 }}{{cbignore}}</ref> The Spanish economy outperformed expectations and grew 3.2% in 2016, faster than the eurozone average.<ref name="Spain outperforms 2016">{{cite news| author=Antonio Maqueda| url=http://elpais.com/elpais/2017/01/30/inenglish/1485768479_753076.html  | work=El País | title=GDP growth: Spanish economy outperforms expectations to grow 3.2% in 2016 | date=30 January 2017}}</ref><ref name="FTbiggestdrop"/> One of the main drivers of recovery was international trade, in turn sparked by dramatic gains in [[productivity#labor|labor productivity]].<ref name="ElPaísPIB"/>  Exports shot up, from around 25% (2008) to 33% of GDP (2016) on the back of an [[internal devaluation]] (the country's wage bill halved in 2008–2016), a search for new markets, and a mild recovery of the European economy.<ref name="Spain outperforms 2016"/> In the second quarter of 2017 Spain had recovered all the GDP lost during the economic crisis, exceeding for the first time [[output (economics)|output]] in 2008.<ref name="ElPaísPIB">{{cite news| author=Antonio Maqueda| url=https://economia.elpais.com/economia/2017/07/28/actualidad/1501225578_410585.html| work=El País| title=EPA: El PIB crece un 0,9% y recupera lo perdido con la crisis| date=28 July 2017| language=es| access-date=28 July 2017| archive-url=https://web.archive.org/web/20170729013549/https://economia.elpais.com/economia/2017/07/28/actualidad/1501225578_410585.html| archive-date=29 July 2017| url-status=dead}}</ref>

By 2017, following several months of prices increasing, homeowners who had been renting during the economic slump had started to put their properties back on the market.<ref name="rentalboom">{{cite news|author1=Lluís Pellicer|author2=Cristina Delgado |url=https://elpais.com/elpais/2017/07/03/inenglish/1499075153_385634.html |title=Property in Spain: Spain's new real estate boom: the rental market |newspaper=El País |date= 3 July 2017|access-date=8 July 2017}}</ref> In this regard, home sales are expected to return in 2017 to pre-crisis (2008) level.<ref>{{cite news| author1=Maria Tadeo| author2=Sharon R. Smyth|url=https://www.bloomberg.com/news/articles/2017-07-21/the-spanish-housing-market-is-finally-recovering | work=Bloomberg | title=The Spanish Housing Market Is Finally Recovering | date=21 July 2017}}</ref> The Spanish real estate market was experiencing a new boom, this time in the rental sector.<ref name="rentalboom"/> Out of [[provinces of Spain|50 provinces]] and compared to May 2007, the [[Instituto Nacional de Estadística (Spain)|National Statistics Institute]] recorded higher rent levels in 48 provinces, with the 10 most populated accumulating rent inflation between 5% and 15% since 2007.<ref name="rentalboom"/> The phenomenon was most visible in big cities such as Barcelona or Madrid, which saw new record average prices, partially fueled by short-term rentals to tourists.<ref name="rentalboom"/>