Passing the first part of the pension reform was the easy part. It is where the pay rise was indexed directly to inflation, so that, in the highly inflationary 2022, pensioners were the only ones in Spain who did not lose purchasing power. Carrying out the second part of the reform was already more difficult, it is not for nothing that the sustainability of the system had to be ensured and, with the arrival of the retirement of the baby boom generation (see previous page), the equation became very complicated.
The solution adopted by the Minister of Inclusion and Social Security, José Luis Escrivá, came in the area of ​​incomes, which are increased in three ways. The first is through the Intergenerational Equity Mechanism (MEI), with an increase in the contribution of 0.6% which will increase to 1.2%. The second additional source of revenue is an increase in the maximum contribution bases and the third is an additional burden on wages above the maximum base.
With this approach, it was clear that high wages would experience an increase in the contribution, but now a study by the Bank of Spain allows us to see in detail which workers and which companies will be most affected. The result is that those who will experience a greater increase in the contribution are high incomes, middle-aged workers, the most qualified and large companies, with a special incidence in the financial sector industry.
At the outset, the study points out that there are 1.3 million workers who in 2021 contributed to the maximum base (4,495 euros per month), which represents 6.8% of the total number of members. They are among those most affected by the increase in contributions, more men than women (8.2% and 5.1%), and more middle-aged. The percentage of contributions for the maximum base exceeds 8% in the group between 44 and 63 years of age, while it does not reach 3% among those under 30 years of age.
The difference is also palpable according to the level of education, from 19.3% those with a higher qualification to 1.3% those with basic education.
The increase in the effective rate of contributions will vary between 0.8p and 1.6p in 2025, to a range of between 1.2p and 11.3p in 2050. In detail, gross wages of around 60,000 euros would increase the social contributions in the largest proportion if we stop at 2025, but if we reach 2050 it would be the salaries of 80,000 euros that will increase the contributions the most.
Another element that stands out is that large companies will be the ones that will face the most important increases in labor costs due to this increase in contributions. Those with more than 500 workers accumulate 13.8% with the maximum quota, while the percentage is reduced to 2.4% for those with one to nine workers. And in terms of sectors, the most affected is the financial services industry, with 54.4%, and, at a distance, business management consulting and activities related to IT services and healthcare.
The study also assesses the increase in revenue that this increase in Social Security contributions will entail. It sets it at 0.6% of GDP in 2030 and 0.9% of GDP in 2050, which is why it aligns with Airef and Fedea estimates and, instead, falls below the calculations of the Ministry of Inclusion and Social Security, which foresees a 1.1% increase in GDP in 2050.
