Announcements
In recent years, Spain has recorded exceptional growth in productivity, reaching levels not seen in three decades.
This advance places the country as one of the leaders in productive improvement within Europe, thanks to changes in employment and efficiency.
Announcements
However, experts warn of a possible drop in labor productivity in 2026, which could slow this progress.
Current situation and paradox of productivity in Spain
Spain is experiencing a historic recovery in productivity with annual growth of 1.4% since 2020, the highest rate since 1995.
Announcements
This improvement occurs together with a forecast drop in productivity per employee for 2025 and 2026, creating an apparent paradox.
GDP grows 33% due to productivity and 60% due to employment, reflecting an unbalanced model with competitive and cost pressures.
Historical growth in total factor productivity since 2020
Since 2020, total factor productivity (TFP) in Spain has grown at an average annual rate of 1.4%, surpassing other European countries.
In 2024, TFP rose 1.9%, while the European average fell 0.7%, with Germany and France on a negative trend.
This increase occurs along with the creation of more than 2.4 million jobs, despite a decreasing investment in capital.
Forecast of drop in productivity per employee in 2025 and 2026
A drop of 0.3% in productivity per employee is anticipated for 2025 and another of 0.2% in 2026, after the recovery period.
Although GDP and employment will continue to grow, labor productivity will not reach pre-pandemic levels, remaining 3.6% below.
This slowdown reflects normalization but shows structural fragility in the Spanish productive system.
Structural causes of productive imbalance
The productive imbalance in Spain is explained by structural failures such as low investment in innovation compared to other assets.
This limits sustainable growth and creates pressures on labor costs that affect long-term competitiveness.
Furthermore, the reduction in hours worked and the employment structure negatively impact labor productivity.
Insufficient investment in R&D&I and technological goods versus real estate assets
Spain invests less in R&D&I and technological goods, prioritizing real estate assets with less impact on productivity.
This lack of technological investment slows down modernization and competitiveness compared to more advanced economies.
The imbalance in capital allocation limits the capacity for innovation and improvement in production processes.
Impact of labor costs and reduction of hours worked on productivity
High labor costs and reduced hours worked slow efficiency and productivity growth per employee.
These conditions complicate the flexible adjustment of the labor market, affecting business competitiveness.
The combination of these factors generates rigidities that make it difficult to improve productivity in the short and medium term.
Comparison with the Eurozone and Spanish singularities
Spain shows productivity growth higher than the Eurozone average in the last five years, reflecting key sectoral advances.
However, it faces unique challenges such as high dependence on traditional sectors and less technological investment.
These particularities condition its productive evolution, differentiating it from the patterns observed in leading European economies.
Better productivity growth rates in Spain compared to Europe in the last five years
In the last five years, Spain achieved productive growth rates that exceed those of countries such as Germany and France.
This dynamism is attributed to the post-pandemic recovery and an improvement in certain industrial and service segments.
Although positive, this evolution has not yet managed to close deep structural gaps in terms of productivity.
Persistence of the lag in GDP per capita and labor productivity compared to the European average
Despite the progress, Spain continues to have a GDP per capita and labor productivity lower than the Eurozone average.
This gap reflects historical limitations in investment, training and technological adaptation that slow down sustainable development.
Overcoming these barriers is key to achieving real convergence with the most developed European countries.
Opportunities and recommendations to consolidate productivity in 2026
Consolidating productivity in 2026 requires taking advantage of technological advances and innovative ways of working to sustain growth.
Promoting a comprehensive strategy that combines digitalization and job training is essential to overcome structural challenges.
Likewise, it is key to promote policies that encourage investment in sectors with high potential for productivity and added value.
Digitalization, work by objectives and reduced-day models as levers for improvement
Digitalization drives efficiency by optimizing processes and facilitating work by objectives, increasing motivation and results.
Reduced-day models can improve quality of life and productivity by promoting a healthy balance between work and rest.
These levers allow greater flexibility and adaptation, key to responding to market changes and improving competitiveness.
Suggestions for international economic policy to encourage investment and digital training
International policies must promote tax incentives for technological investment and continuous training in digital skills.
It is imperative to establish collaborations between the public and private sectors to generate training programs adapted to real demands.
Promoting multilateral funds aimed at innovation and digitalization can accelerate productive transformation in Spain.
