Per capita income in Spain is 15 percentage points below the euro area due to low productivity and high unemployment
MADRID, 12 Nov. (EUROPA PRESS) –
Apparent labor productivity in Spain registered an average growth in real terms between 2014 and 2022 of 0.3%, lower than 0.9% in the European Union as a whole, according to a report published by CaixaBank Research.
The international comparison reflects that there is a significant gap in the level of productivity in Spain and that of the eurozone and the main European economies.
The general director of Economy and Statistics of the Bank of Spain, Ángel Gavilán, recently explained that in 2008 the Spanish economy registered a difference of 8% with respect to the euro zone in per capita income, but that gap has been growing and, according to the latest data available, is currently 15 percentage points below the euro area average.
This lack of convergence is due, according to Gavilán, to two main factors: low productivity and a very high unemployment rate. “This can be fixed with money, but the fundamental thing is the reforms,” says Gavilán.
According to the CaixaBank Research report, in 2022, the nominal GDP per hour worked in Spain – data that already takes into account the review of the historical series of Spain’s GDP undertaken in September 2023 – was 76% of the registered value in the eurozone and only 63% in Germany.
One of the keys to productivity lies in the quality of the human capital of an economy. Workers with a higher educational level and more technically qualified are more productive. According to a study by the Bank of Spain, there is a significant deficit in the level of training of Spanish workers and entrepreneurs compared to the eurozone average.
On the other hand, a key aspect for productivity is the size of the companies. In Spain, the productivity level of large companies is more than double that of microenterprises. However, the weight of medium-sized or large companies in the Spanish economy is lower than in other countries.
In Spain, around 35% of employment is in companies with more than 50 employees, a proportion that stands at 66% in Germany. “Spain needs to further promote the growth of its microenterprises and SMEs,” insist the CaixaBank research service.
Experts maintain that several studies highlight that large companies have a greater propensity to invest in intangible assets and highlight this investment as a catalyst for increased productivity.
Among the intangibles that contribute to improved productivity are, for example, management and organizational efficiency models, marketing, brand value, databases, specific training developed internally or software.
In highly developed economies and close to the technological frontier, these aspects are even more decisive in productivity growth. Thus, when talking about the future of productivity in Spain, it is essential to analyze the weight of investment in research and development in the economy. Specifically, the CaixaBank Research report reflects that the percentage of GDP allocated to research and development in Spain is 1.3% of GDP, clearly below the average of 2% in the eurozone.
For this reason, both the Bank of Spain and other public and private organizations and entities insist on the opportunity that the deployment of the Recovery, Transformation and Resilience Plan, financed with European funds, represents for Spain and the improvement in its productivity. Next Generation EU’.
The Bank of Spain has detected that the largest companies are those that are receiving the tenders linked to the European funds ‘Next Generation EU’, while the subsidies are falling mainly on the small ones.
The economic literature is inconclusive as to what economics is most interested in. Some experts believe that in the short and more in the long term, tenders should be awarded to small companies, with the aim of making them more competitive and thus transforming the economy. However, there is another current that advocates empowering the largest and most powerful companies in the country so that they function as drivers of the economy.
What is being perceived from the Bank of Spain is that the companies that have received tenders – very few and larger – have shown greater dynamism in investment in the short term compared to the companies that have not received them. tenders or who have received other types of calls.
