Purchasing Power in Spain: Anatomy of an unfinished recovery
Purchasing Power in Spain: Anatomy of an unfinished recovery
Fifteen years after the outbreak of the financial crisis, purchasing power in Spain has still not returned to its starting point. Although the economy has gone through phases of recovery, the data shows that by 2023 the average level remained nearly 8% below the purchasing power of 2008. But, as often happens in major crises, the impact was not felt equally by everyone.
The deepest decline came in 2015, when the accumulated loss of purchasing power exceeded 16%. It reflected several years of high unemployment, stagnant wages, and spending adjustments following the collapse of the housing bubble. From that point on, the recovery was slow and fragile. The 2020 pandemic interrupted the improvement, and when the economy began to grow again, the surge in inflation from 2021 onward—partly linked to the war in Ukraine and rising energy costs—once again eroded real incomes.
We are very used to seeing data on how prices evolve through the Consumer Price Index (CPI), usually expressed as month‑to‑month changes or year‑on‑year variations. But what happens when we look further back and compare trends across a broader time span?
Comparing the CPI reference in 2023 with the figures from 2008, the cost of living for Spanish households has risen by almost 30%. The other factor to consider is how incomes have evolved: have they kept pace with rising prices, or have they fallen behind, causing a loss of purchasing power? Looking at the average income over the same period, the increase stands at around 22%, which translates into a relative loss of purchasing power of roughly 8%.
Beyond the headline figures and national averages, a closer look at additional dimensions shows clearly that the impact has not been the same for everyone.
The data reveals that larger households were the most affected. In 2023, households with five or more members, as well as single‑parent families with children, accumulated losses close to 10% compared with 2008. More members mean higher fixed expenses and less room to maneuver when incomes falter. In contrast, single‑person households and two‑adult households weathered the crisis better and, in some cases, managed to end 2023 almost on par with their 2008 purchasing power.
When looking at the impact on individuals, the factor that best explains the differences is age. People between 45 and 64 were among the hardest hit, with losses close to 9%, especially women. This group was directly affected by wage cuts after the financial crisis and faced greater difficulties benefiting from the subsequent recovery.
At the opposite end are people aged 65 and over, the only group that proved resilient: by 2023 they had accumulated gains of more than 14% compared with 2008. Pensions—more stable and revalued in recent years—acted as a cushion against successive crises.
Many young people saw their plans abruptly derailed, facing unemployment, precarious jobs, and stagnant wages. In 2015, the worst year of the decline, they lost nearly 20% of their purchasing power. By 2023, they were still dragging losses of around 4%.
The following interactive dashboard allows readers to explore these differences in detail and see that behind each percentage point lie very different lived realities: