The Government of Spain continues to move forward with its labor agenda with two key measures: the reduction of the working day to 37.5 hours per week and the increase of the Minimum Interprofessional Salary (SMI) for 2025. This latter increase of 50 euros will raise the SMI to 1,184 euros per month in 14 payments, benefiting around 2.5 million workers.
This increase, which represents a 4.4% rise compared to the current amount, will benefit approximately 2.5 million workers, especially in sectors such as hospitality, retail, agriculture, and domestic services. With this measure, the government aims to ensure that the minimum wage represents 60% of the average salary in Spain, in line with the recommendations of the European Social Charter. This measure comes within the context of labor reforms aimed at improving workers’ purchasing power and reducing wage inequality.
Details of the measure
Yolanda Díaz, Spain’s second vice president and Minister of Labor and Social Economy, highlighted that this decision is “an important step to reduce wage inequality and improve the quality of life for workers with lower incomes.”
This increase is in addition to the successive increases of the SMI in recent years. Since 2018, the minimum wage has increased by more than 60%, rising from 735.90 euros per month in 14 payments to the 1,184 euros approved for 2025, placing Spain among the European countries with the most intense evolution in this area. According to the Ministry of Labor, the Government made this decision after negotiating with trade unions, although without the support of business organizations, who have expressed concerns about the potential impact on business competitiveness and employment.
This increase results in an annual gross SMI of 16,576 euros, which, if prorated over 12 monthly payments, leaves a gross monthly SMI of 1,381.33 euros.
Next steps for the SMI
When will the minimum wage increase take effect? The agreement stipulates that the 2025 SMI increase will be applied retroactively from January 1st. Employers must therefore adjust the amount corresponding to January, with the increase reflected in the February payroll.
>In addition to announcing the 50-euro SMI increase, the vice president informed that the agreement with the unions includes the creation, within two months, of a social dialogue table. This space will address issues such as the adaptation of the European directive on minimum wages, the launch of specific campaigns by the Labor Inspectorate to ensure SMI compliance in the most vulnerable sectors, and the design of measures to improve its implementation.