A new study on social exclusion in Spain has found evidence that the combination of rising property prices and job insecurity is shrinking the Spanish middle class and pushing people into economic precariousness.
The Spanish middle class is shrinking amid an “unprecedented process of social fragmentation”, a new report has concluded.
The 9th FOESSA Report, presented on Wednesday by Cáritas Española, warned of social fragmentation at a time when some in Spain enjoy an “apparent bonanza” as millions of others suffer from “one of the highest rates of inequality in Europe”.
The study also found that 4.3 million people in Spain live in a situation of severe exclusion and the trend is only getting worse. In 2024, severe exclusion was 52 percent higher than in 2007.
Caritas also warned that the issues of housing and employment mean that the middle-class in Spain is increasingly tested, with wages becoming more precarious compared to price rises and that in 2025 having a job does not guarantee avoiding growing inequality.
This comes despite the Spanish economy outperforming the majority of developed economies in the post-pandemic period, boasting macro growth figures far better than other countries traditionally seen as more stable economies. But this isn’t trickling down to Spaniards and helping inequality, the study found.
“Even with economic growth, Spain has one of the highest rates of inequality in the European Union,” said the report’s coordinator, Raúl Flores, something which he says “perpetuates poverty and exclusion.”
“Renting has become a poverty trap,” Flores added.
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The report reflects this sentiment. As for the main drivers of rising social exclusion, the study points to increasing insecurity in the housing and job markets, with a combination of rising property prices and stagnant wage growth pushing people into economic difficulty who might’ve previously enjoyed more middle class lifestyles.
Specifically, on the former, the report notes that 45 percent of the population living in rented accommodation in Spain are at risk of poverty and social exclusion, the highest figure in the EU.
Data from Spanish property website Idealista shows that average rents have risen by 10.9 percent in a year.
According to a study by the Spanish property search engine pisos.com, 37 percent of rental homes in Spain cost more than €1,500 per month, a sum that’s higher than millions of Spaniards’ monthly wages.
READ ALSO: More than a third of rentals in Spain exceed €1,500 per month
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Furthermore, the report states that “employment has lost much of its protective and integrating capacity, with job insecurity affecting almost half (47.5 percent) of the active population. This is, they say, ‘11.5 million people trapped in various forms of job insecurity.”
The study also points out that two out of every three households in a situation of moderate exclusion have at least one person in work without the employment being a guarantee of a stable or middle-class life.
It indicates that 4.3 million people in Spain live in a situation of “severe social exclusion”, defined as being unable to access the basics for a decent life, such as adequate housing or being able to afford unforeseen expenses.
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