How Spain became so successful: immigrants

Remember back in the late 2000s/2010s, Spain, along with southern European neighbours Portugal, Italy and Greece were disaparagingly referred to as "PIGS", and mercilessly berated by more successful European countries like Germany and France?

Well, not any longer. Since the 2020 pandemic, Spain's economy has boomed while the likes of Germany, France and the UK have struggled. Disposable income in Spain has risen three times as fast as in France and eight times as fast as in Germany. Unemployment, poverty and inequality have all fallen to their lowest levels in nearly 20 years. The Economist ranked Spain as the No. 1 economy in the world in 2024.

All this has happened under the progressive centre-left government of the Spanish Socialist Workers Party, which has now been in power for eight years. It has welcomed record numbers of immigrants, hiked the minimum wage, implemented energy price controls, fast-tracked renewable energy projects, and even implemented a kind of guarantees income system. Just about the only negative arising from all this is a burgeoning housing crisis, which the government will need to address if it wants to retain voter popularity.

When the initial COVID lockdowns started to fade in 2021, and tourists started to flock back to Spain (the country has always been in the top three of global tourist destinations), Spain, with one of the fastest-ageing populations in all of Europe, just didn't have enough workers to keep up. Increased immigration was the obvious solution, but that also had political ramifications, and the country's surging hard-right faction was ever active on that file, as always.

Spain's solution was elegant. It visibly cracked down on the most controversial form of immigration: African migrants entering the country illegally by boats across the Mediterranean. This was actually just a tiny proportion of its overall immigration, but it was the one most often targeted by the populist right wing and by the Spanish public in general. At the same time, they substantially ramped up the least controversial form of immigration: legal Latin Americna migrants. Given that they share a language and certain cultural affinities, Latinos have always been reasonably well-tolerated in Spain, especially if they do the least -popular and poorly-paid manual jobs.

They fast-tracked work authorizations for immigrants willing to work in those sectors with labour shortages, streamlined the foreign work visa process, and encouraged workers to settle in areas where the local workforce had dried up. Government representatives would even recruit individuals from the migrant refugee camps on the US-Mexico border. 

It was a very successful strategy even if it wasn't particularly progressive in some respects. In just two years from 2021-3, Spain added 3 million workers to its 48 million population. They injected new life into Spanish economy, allowed businesses to expand, and some of the more ambitious immigrants even went on to open up new businesses themselves. By some estimates, a quarter of the rise in Spain's GDP over the last few years can be attributed directly to immigrants.