Wages in the Balearic Islands reached a milestone in 2025, surpassing the national average for the first time since 2008 – the year the calculation methodology changed and the current time series began. Since then, the average salary in the islands had always been in the lower half of the table. Until last year. The average monthly gross salary in the Balearic Islands was €2,396.38, about €20 above the national average, which stood at €2,376.50.
This is according to the Labor Market Report from the Labor Observatory of the Balearic Islands, based on data from the National Statistics Institute (INE) and the Ministry of Labor and the Social Economy. According to the latter, last year up to 16 collective bargaining agreements were signed in the Islands – six at the company level and ten at a higher level – which affected 221,664 workers and represented an agreed wage increase of 4 percent, higher than the 2.9 percent recorded for Spain as a whole.
Even greater was the overall increase in total wage costs in the region compared to 2024: a 6.3 percent increase, versus 3.2 percent for the country as a whole – nearly double. The Archipelago was the region with the most pronounced increase. It wasn’t the only labor statistics table it topped that year: it also led the table for actual hours worked per worker.
But when it comes to collective bargaining agreements, one cannot fail to mention the most notable agreement of that year: the 17th Collective Bargaining Agreement for the Hospitality Sector, signed in July. This document establishes a 13.5% wage increase over three years for about 160,000 workers, with a 6% increase for the first year, 2025. Given its importance and scope, there is no doubt that the collective bargaining agreement for the restaurant sector has a major influence on wage analysis in the Balearic Islands. Despite the disagreements that marked the entire negotiation process – the agreement was finally reached without one of the trade union organizations, CCOO, which criticized the terms agreed upon between UGT and the employers’ organization – the fact is that the agreed wage increase was the highest ever achieved, and the agreement became a benchmark for sectoral negotiations in other parts of Spain.
Also noteworthy from that year was the collective bargaining agreement for freight transport, which provided for a 12 percent wage increase, and the one for regular passenger road transport, which provided for a 5 percent increase. All of this makes 2025 a turning point: the moment when the Balearic Islands returned to the upper half of the national wage scale, according to available data.
The methodology of the INE’s Survey of Wage Structure (EES) was revised and standardized in 2008, from which point it began to be published annually. In studies conducted in previous years – 1995, 2002, and 2006 – the Balearic Islands typically had an average salary above the national average, with a dynamic economy driven by the tourism and real estate sectors before the Great Recession. The methodological change coincided with a downward trend in wages in the Balearic Islands, while the cost of living was rising at a rapid pace, especially during the last decade.
Consequently, the upward trend observed in 2025 – which could continue throughout the current year – has offset the loss of purchasing power that workers in the Balearic Islands had suffered for decades. Catalina Cabrer, the Minister of Labor, Public Function, and Social Dialogue of the Government of the Balearic Islands, highlighted these figures and celebrated that “in the Balearic Islands, wages are rising faster than the cost of living, and that is very good news.” Cabrer explained that all of this is the result of collective bargaining “and the efforts of business organizations in implementing wage increases: we are focused on ensuring that employment is of high quality.”
The main trade unions have celebrated these increases, although the constant rise in the cost of living has eroded their impact from the start. This is true not only with regard to housing access – by far the main problem for residents of the Balearic Islands – but also with regard to the cost of the shopping basket and other daily expenses. In fact, in 2025, the Balearic Islands saw these wage increases accompanied by inflation higher than the Spanish average: 3.1 percent compared to 2.7 percent. The Consumer Price Index (CPI) registered a 4.4 percent increase in the Balearic Islands last August, a tenth of a percentage point above the national average and the highest figure since April 2023, when it reached 4.6 percent.
“The wage increase achieved in the collective bargaining agreement for the hospitality sector was significant,” admits the general secretary of CCOO, José Luis García, adding that, unfortunately, “it’s the same old story: even the highest wage increases in the country are not enough to live in the Islands, especially considering the housing problem.” Therefore, García calls for the implementation of public policies and a ‘national agreement’ to reduce the gap between the cost of living in the Balearic Islands and the purchasing power of its citizens. The general secretary of the UGT, Pedro Homar, shares this view and points out that these increases “are still not enough to cover the daily expenses of Balearic residents, especially when it comes to housing.”
However, the Balearic Islands’ leading position in terms of wage increases is complemented by its leading position in terms of working hours, a position it has maintained for several years. The Balearic Islands are the region with the highest number of actual hours worked per worker per month, with an average of 135.2 hours – more than seven hours above the national average (127.8). They are followed by the Community of Madrid (131.7) and the Canary Islands (129.7). At the other end of the table is the Basque Country, with 120.5 hours worked.
The data, therefore, reveals a paradox: the Balearic Islands not only lead in wage growth, but also in the number of hours their workers dedicate to their jobs. This progress in wages, however, goes hand in hand with a cost of living that continues to be one of the main obstacles to improving purchasing power. The challenge, therefore, does not seem to be limited to earning more money, but rather to ensuring that this wage increase also translates into a greater ability to live and thrive on the islands.
