Spain’s socialist government champions immigration not only for humanitarian reasons but as an economic growth strategy.
Far removed from the economic struggles that followed the 2008 financial crisis, today Spain leads the European Union with impressive economic performance.
In 2024, Spain’s GDP grew by 3.2 percent, earning recognition from the Economist as the best-performing rich economy of the year in its rankings of the Organisation for Economic Cooperation and Development (OECD) countries.
Spain’s central bank forecasts at least 2.5 percent growth in 2025.
One of the key factors behind this growth is Spain’s liberal immigration policy, which analysts agree has played a central role in driving economic prosperity. Even the Times, which has not typically been sympathetic to pro-immigration arguments, acknowledged Spain’s economic success is closely linked to immigration.
“Booming Spain is on track to a new age of prosperity, thanks to a surge in immigration, a thriving tourist trade and lower energy prices,” was a recent Times’ headline.
Today, foreign-born nationals account for 18.1 percent of Spain’s population, with nearly 42 percent of them aged between 25 and 44 – a large demographic eligible to participate in the workforce.
Spain’s socialist government champions immigration not only for humanitarian reasons but as an economic growth strategy.
“[Immigration is] not just a question of humanitarianism…, it’s also necessary for the prosperity of our economy and the sustainability of the welfare state…The key is in managing it well,” said Prime Minister Pedro Sánchez in an address to parliament in October.
To accommodate and integrate immigrants, Spain has introduced several initiatives. The government is implementing a mass regularisation programme to provide residency status to around 300,000 undocumented migrants by 2027.
The move aims to bring more tax-paying foreign workers into the economy to support Spain’s welfare system. With an estimated 600,000 undocumented migrants in the country, Spain has one of the highest rates of undocumented migrants in the EU, and experts agree that regularising their status is crucial to ensuring their contribution to the economy.
A study by the Migration Policy Institute, Spanish institutions, and major trade unions, agreed that “an increasing immigrant population with irregular status was more problematic… those constrained to work in the informal economy would not pay income taxes or contribute to social security programmes.”
In addition to regularisation efforts, Spain has extended temporary work permits from two to four years and made it easier for foreign students to access the job market.
Public sentiment towards immigrants in Spain broadly echoes the government’s positive and proactive position. Recent data by Statistica showed that nearly 75 percent of young people in Spain believe that immigrants’ customs must be respected, as long as they don’t clash with the nation’s constitution.
Beyond migration, other factors are driving Spain’s growth, including a booming tourism industry, rising services and industrial exports to the European single market and beyond, the growth of technology and financial businesses, and low energy costs thanks to Spain’s extensive renewable energy sector.
Labour reforms under the left-wing government have also contributed to economic growth, including a more than 50 percent increase in the minimum wage since Sánchez took office in 2018, putting more disposable income in the hands of low-income workers.
But migration is still the most frequently cited reason for Spain’s enviable economic growth.
As journalist Maria Ramirez, deputy managing editor of elDiario.es, puts it, Spain’s success “proves xenophobia doesn’t pay.”
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