Small companies lead wage increases in Spain, according to EADA and ICSA’s Salary Evolution 2007–2025 report
Small companies have recorded the largest wage increases in Spain across all professional categories over the past year. This is one of the main conclusions of the 19th edition of the “Salary Evolution 2007–2025” report, produced by EADA Business School and the consultancy firm ICSA Grupo. The report analyses the evolution of salaries for executives, middle managers and employees in relation to inflation, the cost of living and GDP growth.
The report confirms that this wage effort by SMEs is driven by the need to improve their competitiveness in attracting, retaining and motivating talent, compared with large companies, which start from higher pay levels and more generous compensation packages.
Employees lead wage growth and outperform inflation
One of the study’s key findings is that employees account for the highest wage increase in 2025, with a year-on-year rise of 5.5%, bringing the average salary to €28,577 per year. This is also the only professional category to outperform inflation, breaking the long-standing trend of declining purchasing power accumulated since 2007.
This growth is explained by several factors, including increases in the statutory minimum wage (SMI), collective bargaining agreements partially indexed to the CPI, and greater technical specialisation in operational roles, which has increased their value in the labour market.
Executives and middle managers: very moderate pay increases
By contrast, executives recorded a wage increase of 1.59%, reaching an average annual remuneration of €90,246, while middle managers experienced only a marginal improvement of 0.25%, equivalent to an average of €105 per year.
Based on salary data from more than 80,000 salaried employees in Spain, the study highlights that middle managers are the category that has suffered the greatest cumulative loss of purchasing power since 2007.
Digitalisation and AI are redefining the role of middle management
The evolution of this category points to a process of organisational flattening, together with the partial replacement of functions resulting from digitalisation and the integration of artificial intelligence, particularly in sectors such as banking. In this new scenario, middle managers find themselves positioned between executives who are increasingly supported by technology and employees with ever more technical profiles.
Banking and industry, the highest-paying sectors in Spain
By sector, banking continues, for yet another year, to offer the highest salaries in Spain, except in the employee category, where it is surpassed by industry, with an average difference of €1,368 per year.
Specifically, employees in the industrial sector earn an average salary of €31,597, followed by banking at €30,229. At the opposite end of the scale, the retail and tourism sector records the lowest salaries across all categories, with an average of €20,228 per year for employees. Nevertheless, this sector also stands out for having registered the largest year-on-year wage increase, with a rise of 8.28% compared with 2024.
Wage differences by autonomous communities
From a territorial perspective, Madrid and Catalonia continue to lead salary levels across all professional categories, remaining above the national average. By contrast, regions such as the Balearic Islands and the Canary Islands stand out for their wage dynamism, driven mainly by population growth and migration inflows rather than by clear improvements in per capita productivity.
In 2025, the autonomous community with the highest wage growth among executives was Aragon (+2.49%); among middle managers, Asturias (+2.87%); and among employees, the Balearic Islands (+9.98%).
Productivity, wages and business competitiveness
According to Anton-Giulio Manganelli, Professor of Strategy at EADA Business School, “Spain is creating jobs and economic volume, but this growth is not translating into a proportional improvement in productivity per worker.” This gap, he notes, explains why “despite GDP growth, real wages are not rising at the same pace and the loss of purchasing power remains a constant.”
Along the same lines, Ernesto Poveda, Executive Chairman of ICSA Grupo, warns that “SMEs are bearing a high wage cost in order to attract and retain talent in competition with large companies”, which could lead to medium-term strain. Both agree on the need to move towards more flexible, sustainable and productivity-linked compensation models, incorporating non-monetary elements such as flexibility, remote working and continuous training.
