Why Are Expats Leaving Spain?

Spain has long been a favourite destination for expats, especially from the UK. However, recent years have seen a notable shift, with many choosing to leave. The reasons could involve the new resident rules, the economic challenges, the language barrier, or job market issues. Let’s explore the reasons behind this trend and the recent solutions the Spanish government has taken to overcome these problems.

Why Are People Moving Out of Spain?

Many expats cite financial difficulties as a primary reason for returning home. Many mention that Spain is perfect if you have already settled financially, but the story can be completely different if you are starting. If you’re a young professional, for example, looking to spare money and plan, it is the best choice if you aim to live in Spain any time soon. The economic instability is mainly due to low productivity. Spain has faced financial challenges, including a prolonged recession, high unemployment rates, and stringent austerity measures. These factors have made it difficult for expats to find stable employment and maintain their standard of living. Also, the challenges of acquiring the right to healthcare, homesickness, cultural differences, and some difficulties in renewing expired visas are common reasons for leaving.

Unemployment and High Poverty Rate in Spain?

Unemployment in Spain remains high due to structural issues in the labour market, such as a reliance on temporary contracts and skill mismatches. The slow economic recovery and limited job creation have also contributed to the problem. All these issues, financial instability, and high unemployment rates have led to increased poverty. Many families struggle to meet basic needs, and the social safety net is often insufficient to cover everyone’s needs. The gap between rich and poor has widened, making it harder for those at the bottom to climb out of poverty. The government is implementing policies addressing unemployment issues, including promoting vocational training and supporting small and medium-sized enterprises​. Regarding the poverty rate rates, efforts are being made to improve social welfare programs and create more inclusive economic policies, but significant challenges remain​.

Is Spain Still in a Recession?

Spain has technically exited the recession, but the recovery is fragile. The economy is growing slowly, and many issues from the recession, such as high unemployment and public debt, persist. The financial problems can be pretty scary for potential newcomers. High public debt and economic disparities are ongoing issues. The government is constantly working on implementing measures to stimulate economic growth and reduce deficits​. The strategies go from stabilising the economy to promoting fiscal reforms and measures to boost employment and reduce inequality​.

Are Brits Still Moving to Spain?

Despite the increasing number of departures, Britons constitute a significant portion of Spain’s expat community. According to recent data, Brits account for about 9.5% of Spain’s foreign real estate transactions. However, this figure has declined from 14.1% in 2019, reflecting the impact of Brexit and other factors. In conclusion, while economic and political challenges exist, Spain remains a favoured destination for British expats. The country’s efforts to address these challenges and the ongoing appeal of its lifestyle mean that many Brits still find Spain an attractive place to live and invest. For those considering the move, understanding the new rules and planning accordingly can help navigate the challenging landscape effectively.

What Problems Is Spain Facing?

Spain is struggling with several critical issues in 2024, each posing significant challenges to its economic and social landscape. Here’s an overview of the critical problems and the government’s efforts to address them:

High Unemployment Rates: Spain’s unemployment rate remains high at approximately 12.5%, significantly above the Eurozone average. The government has implemented labour market reforms to increase permanent employment and reduce temporary contracts. Additionally, measures have been introduced to ease requirements for foreign workers and integrate them into the official labour force, addressing unemployment and labour shortages in sectors like hospitality and agriculture​.

Economic Instability and Public Debt: Spain continues to deal with economic instability, partly due to its high public debt, around 97% of GDP. To mitigate this, the government has approved various financial aids, including €16 billion in direct assistance and soft loans for households and businesses, capping gas prices, and providing mortgage relief measures. A windfall tax on power companies and banks is also expected to generate additional revenue.

Climate Change and Environmental Issues: Spain faces severe environmental challenges, including water shortages and the impacts of climate change. The government’s recovery and resilience plan allocates significant investments towards the green transition. Over €12 billion is being invested in energy efficiency for buildings, €13.2 billion in sustainable mobility, and substantial funds for clean energy technologies and infrastructure. These efforts aim to promote a circular economy and mitigate adverse climate effects.

Pension System Sustainability: Spain’s pension system is under significant strain due to an ageing population and low fertility rates. Reforms have been made to adjust pension calculations based on life expectancy and restore inflation indexation. However, concerns about the long-term sustainability of the pension system remain, with additional reforms needed to ensure its viability.

Digital and Economic Transition: The digital transition is another critical area. Spain’s recovery plan includes investments in digital skills training, digital transformation of public administration, and boosting the digitalisation of industries and SMEs. These initiatives aim to address the digital skills gap and promote economic resilience.

Social and Economic Resilience: The government focuses on education reforms to reduce early school leaving rates and align skills with labour market needs to enhance social resistance. Investments in vocational training, upskilling, and active labour market policies are also part of the strategy to improve employability and economic stability.​

Spain’s government is working on these fronts to tackle the nation’s challenges. By investing in sustainable and digital transitions, reforming labour and pension systems, and enhancing economic resilience, Spain aims to build a more stable and prosperous future.

Finally, Why Are Expats Leaving Spain?

The decisions might all be based on the reasons we mentioned above, or they could not be related to them at all. So, if you have been or are going through this process, share your thoughts with us. Your point of view can help others surf a way lighter wave, whether moving to Spain for family or professional motives. Speaking of making it easier, let us handle the logistics while you focus on your new beginning. VanOne International Movers offers comprehensive services if you’re considering relocating from or to Spain. We ensure a smooth transition from customs clearance to door-to-door collection and delivery. Whether you’re moving due to economic reasons or personal preferences, our expertise can help make the process less stressful. Contact us today to learn more about our services and how we can assist you.