Spain will increase the minimum wage to increase revenues and reduce the gap in the well-being of citizens. The authorities of the European country decided against the background of the growth of inflation that has reached the ten-year high, reports Bloomberg.
Spanish Prime Minister Pedro Sanchez announced the government plans this year to increase the minimum wage, which is currently 950 euros (1123 dollars), to maintain the purchasing power of the population as the economy has grown and increasing the cost of life.
According to the Minister of Economy of Nadia Calvigno, the increase in the minimum wage has become a priority of the government over the past three years and is considered as an effective tool for reducing inequality. She stated that the economy of Spain is now growing the fastest pace since the 1970s, restoring the crisis due to the coronavirus pandemic. In 2020, the country’s GDP decreased by almost 11 percent. Prices in Spain have grown, including due to higher cost of electricity – its growth has stimulated inflation in the whole region.
Calvigno added that the current economic situation is quite explained after many years of low inflation and price stability during a pandemic. The inflation jump the minister called the “transitional phenomenon”. “We must avoid [high inflation] to become structural, but it is a natural phenomenon with a very active recovery [Economy], which we observe, (…) And this is not a reason for concern,” she said.
Inflation growth raised several European states experiencing economic lifting after a pandemic. In Germany, life has risen in price to a record level since 2008, and Poland was on the verge of an economic disaster due to inefficient combating price increase.