The Impact of COVID-19 on Poverty in Spain

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MILFORD, Michigan — After its origins in China first roused worldwide concerns, COVID-19 truly took global precedent after a soccer match in Europe in February 2020. This soccer match between Italian club Atalanta and Spanish club Valencia spread COVID-19 in Europe and impacted those nations’ economies. This was deemed the epicenter of the initial COVID-19 surge in Europe and one of the first surges in the world. The impact of COVID-19 on poverty in Spain soon took shape at a faster pace than in most other nations.

Poverty in Spain

After remaining at around 22% for five years, the percentage of Spain’s total population at risk of falling into poverty actually decreased in 2019 to 20.7%. In addition, the United Nations reportedly described 26.1% of Spain’s population as “at risk of poverty or social exclusion” in 2018, which is one of the highest rates in Europe.

Also, a related concern is Spain’s insufficient spending on social benefits and education. The minimum pensioner received just a “little more than a third of the minimum wage.” This was only equal to $439.31 each month. Moreover, education funding has significantly decreased despite Spain “having the highest dropout rate in the EU” at 17.9%.

COVID-19 Concerns Extend Beyond Infections

Spain is believed to exhibit one of the largest gaps between high- and low-income households in the developed world. Its basic income program of approximately $1,188 per month was inefficient in its distribution to the 2.3 million prospective recipients and altogether insufficient to alleviate poverty.

Workers from industries most adversely affected by COVID-19 expected government support. The true impact of COVID-19 on poverty in Spain can be ascertained when examining the 11% decline in GDP in 2020. This was among the worst decrease in GDP of all the European nations. For comparison, Italy had an 8.9% decrease in GDP.

One reason for this is because Spain is especially dependent on tourism to stimulate its economy. The pandemic most severely affected countries that rely on tourism. Tourism accounts for 14.3% of Spain’s total GDP, which is equivalent to $200 billion. This recession represents the most drastic decrease in GDP since the country’s civil war from 1936-39.

The pandemic hit Spain’s economy especially hard early on. Nearly 1.1 million people lost their jobs in 2020’s second quarter alone. Moreover, the country held the world’s second-highest death toll one month into the pandemic. Therefore, COVID-19 forced Spain to impose heavy restrictions.

Vaccines and Reopening

The impact of COVID-19 on poverty in Spain was significant. The pandemic resulted in the worst poverty rates since the country’s civil war and certainly exceeded the recession in 2007. However, along with some of its European neighbors, Spain reopened its borders to foreign tourists starting in June. With more than 68% of its population fully vaccinated as of Aug 2021, Spain was hoping to welcome travelers from other nations that have reached high vaccination thresholds. The E.U.’s fourth-largest economy hoped to capitalize on the observed trend of highly vaccinated areas presenting low infection rates in its effort to reach economic recovery in 2021. However, with the new Delta variant, it is possible that Spain will reduce foreign travel again.

Paolo Emilio Giannandrea
Photo: Wikimedia

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