Wages in Spain continue to rise, reaching a new high. However, inflation is catching up: in August, consumer prices were already 4.3 percent above the level of the previous year. Collective wage agreements also continue to lag behind price trends.
Spain Expat Press Editorial Team
by Marlon Gallego Bosbach
Average salaries in Spain rose by 4.2 percent in the second quarter of 2026, according to the latest data from the Spanish statistical office, INE. This brought the average gross monthly wage to 2,464 euros (based on twelve annual payments). At the same time, pressure on purchasing power is mounting, as inflation has now reached a level similar to that of wage growth.
Average wage reaches new high
Wage growth has accelerated recently. After initially slowing down in the spring and summer of last year, it picked up again in the autumn. In the first quarter of 2026, the increase already stood at 4.2 percent.
This trend continued in the second quarter. According to the INE, the average gross monthly wage reached 2,464 euros, adjusted for seasonal and calendar effects. This marked a new record high in the statistics.
Total corporate labor costs also rose by 4.2 percent during the same period. In addition to salaries, this figure includes social security contributions and other cost components. Average labor costs per hour worked increased by 4.4 percent year-on-year to 19.41 euros.
However, the statistics do not cover all employed persons in Spain. Among others, agricultural workers, domestic staff, and certain groups of civil servants are not included. Furthermore, the average wage can also change as people enter or leave the labor market.
Inflation catches up with wage growth
As recently as March, wage growth of 4.2 percent had been significantly higher than the inflation rate of 3.4 percent at the time. This enabled employees to effectively offset a portion of the rising cost of living.
The situation has since changed. In August 2026, Spanish inflation stood at 4.3 percent, slightly above the wage growth recorded in the second quarter.
If consumer prices rise faster than salaries, purchasing power declines. Employees are then able to afford less than before, despite receiving higher nominal pay. For many households, therefore, what matters is not just the size of the pay rise, but how much of it actually remains after accounting for price increases.
Significant differences between industries
Salary trends vary by economic sector. Particularly strong increases were recorded in the second quarter in the education sector and in public administration.
In the education sector, gross wages rose by 9.6 percent, and in public administration by 8.4 percent. However, according to the report, these figures are also attributable to unusual calendar effects and additional payments.
In the education sector, the scheduling of the Easter holidays played a role, among other factors. While the days off school in the previous year fell predominantly in April, in 2026 they were distributed across the first and second quarters. Consequently, the number of working days influenced the statistical comparison.
Higher special payments were a significant factor in the public administration sector. A similar effect was observed in the real estate sector, where salaries rose by 7.8 percent.
Wage increases also vary by region
There are also significant differences in wage growth among Spanish regions. The highest increases in the second quarter were recorded in Cantabria, at 8.8 percent. This was followed by Asturias with 6 percent, Catalonia with 5.1 percent, the Basque Country with 5 percent, and the Balearic Islands with 4.7 percent.
In the Community of Madrid, salaries rose by 4.3 percent, and in the Canary Islands by 4.1 percent. Andalusia recorded an increase of 3.7 percent.
At the lower end of regional development were Navarre (2.2 percent) and La Rioja and Extremadura (2.4 percent each). The figures refer to changes in salaries and, on their own, do not indicate which region has the highest average income.
Collective bargaining agreements lag behind inflation
In addition to statistics on actual labor costs, there is another key indicator in Spain: salary increases agreed upon in collective bargaining agreements. As of August 2026, the average rise in collectively agreed wages stood at three percent. This figure takes into account all collective agreements with economic effects applicable during the current year, regardless of when they were concluded.
For collective agreements signed in 2026, the increase was higher, at 3.8 percent. However, these agreements currently cover only around 1.3 million employees. Consequently, the collectively agreed salary increases are currently below the prevailing inflation rate.
According to estimates by the economic research institute Funcas, inflation could rise to near five percent in September. The institute projects an average rate of 3.6 percent for the year as a whole. Should this forecast prove accurate, the wage increases agreed upon for 2026 would, on average, be insufficient to fully offset the rise in prices.
Absences due to illness reach record levels
INE statistics also show trends in working hours. Particularly notable is the number of hours lost due to illness. In the second quarter of 2026, absences due to illness accounted for an average of 8.5 unworked hours per employee per month. This represents a 3.7 percent increase compared to the same period the previous year and marks a historic high.
A particularly high number of hours lost was recorded in the health and social care sector, averaging 11.6 hours per employee per month. In the transport and storage sector, the figure was 10.9 hours, and in administrative and support services, it was 10.4 hours.
Figures were also above the national average in public administration and defense, the manufacturing industry, and the trade sector. In the hospitality industry, by contrast, an average of 7.1 hours of sickness-related absence per employee per month was recorded. In the education sector, the figure was 6.1 hours.
The data thus illustrate two parallel trends in the Spanish labor market: nominal wages continue to rise, while inflation erodes part of the gains and sickness-related absences reach a new record high.
