The North-South Divide: Economic Inequality in Spain and its Impact on Education, Employment, and Life Expectancy

If the 126 main cities in the country are compared according to the level of higher education of their population, both stand out again, and again each one at one extreme: 74% of the inhabitants of the Madrid population have higher education compared to 18 % in Alicante.

It’s not a coincidence. Economic inequality conditions the level of studies. And also the unemployment rate and even the life expectancy of its inhabitants. Continuing with Pozuelo and Torrevieja, of the 126 main cities in Spain, the unemployment rate in the municipality with the highest income is 6%; in the poorest locality, 24%. And the people of Pozuelo live on average almost four years longer than the people of Torrevieja.

Nor is the geographical situation of both municipalities within the borders of Spain a coincidence. The 84,460 euros on average are in a location further north than the 20,046 euros because the great gap in income inequality passes through the center of the Iberian Peninsula.

“It’s been four decades since regional inequality in Spain began to increase and since then this trend has only strengthened,” say economists Alfonso Díez-Minguela, Julio Martínez-Galarraga and Daniel A. Tirado-Fabregat in an article by 2019 of Nothing is freewhich presented a book about this economic gap.

This paper concludes, on the one hand, that the increase in regional inequality is not exclusive to the Spanish economy, “but rather attends to a more general phenomenon”. And, on the other hand, that in this situation “it is difficult not to link, given the similarity in the chronology, the increase in interpersonal inequality with the increase in territorial inequality.”

“At the start of the industrialization process in the middle of the 19th century, no geographical pattern was observed in income levels. However, throughout the first half of the 20th century, a spatial pattern was gradually formed characterized by the existence of an income gradient that runs through the peninsula from the northeast (rich) to the southwest (poor), and that was consolidated until the eighties. Since then, the map has been showing a greater north-south division, in which the lower-income territories are concentrating in a (growing) territory that runs, from east to west, throughout the south of the peninsula”, explain these three economists.

“Wealth is polarizing, and it’s something that happens all over the world,” agrees Albert Recio, professor of applied economics at the UAB and member of the scientific council of Attac, who stresses that “towns-ghettos of rich people have been created around business and industrial centers”, while the poorest municipalities are linked “to agriculture and tourism, with low incomes and more job insecurity (especially due to seasonality), of which, in addition, the middle classes they are disappearing”. “This is how the economic history of Spain can be understood,” he continues, and, from a more global perspective, he warns that “economies of scale make it necessary to concentrate production and that polarizes income levels.”

Of course, there are exceptions to this north-south gap: non-industrialized municipalities that do not provide financial or technological services either, which are either specialized in tourism with high purchasing power, as occurs in some towns in the Canary Islands, or have a great weight relative to public administrations, as is the case in Ceuta and Melilla.

In a context like this, “the conditions exist for the appearance of new social and political tensions of which the rise of phenomena that call into question the institutional and territorial spheres of decision-making (anti-Europeanism) or of withdrawal in the face of the territorial effects of globalization (return to the protectionist or anti-immigration discourse)”, defend the experts in nothing is frees.

Less income, more unemployment

Ángel de la Fuente, economist at the Fedea analysis center and the Institute for Economic Analysis (CSIC), published a study in January 2020 on this same issue with results among which stands out “the growing weight of the employment factor as a source of the per capita income disparities between the autonomous communities”.

“While regional productivities have converged at a good pace during almost the entire period analyzed [de 1955 a 2018], the occupancy rates of the poorest regions have fallen in relative terms, making it difficult for them to move towards income levels close to the national average and slowing down the convergence process”, he explains. “As a result, territorial income inequality has ceased to be an almost exclusively productivity problem and has become fundamentally an employment problem,” he continues.

Linares, in Jaén; La Línea de la Concepción, in Cádiz; Alcalá de Guadaíra, in Seville… up to eight of the ten main cities with the highest unemployment rate in Spain are Andalusian. They are also some of the poorest towns in the country. If the filter is extended to twenty, twelve Andalusian municipalities lead this classification, along with others from the Canary Islands, Ceuta and Castilla-La Mancha, all of them with figures well above 15% of the national average. At the opposite extreme, towns in Madrid, Catalonia, the Basque Country and Galicia monopolize the list of cities with the best figures.

In its report on urban indicators, the INE also includes the educational level of the population of the 126 main cities in the country. The following graph relates the level of average household income with the percentage of the population with higher education. Again, rich municipalities lead the ranking of training, and vice versa. In Sant Cugat del Vallès, 72% of its population has professional training or university studies, well above the 39% of the national average. In Chiclana de la Frontera, in Cádiz, this proportion does not even reach a third of its population.

The north-south gap is appreciated, even in indicators such as life expectancy. In Spain, life expectancy at birth currently stands at 83.6 years. But in La Línea de la Concepción (Cádiz) – one of the poorest cities and with the highest unemployment rate in the entire country – it is almost four years less. On the other hand, the inhabitants of Pozuelo de Alarcón (Madrid) live, on average, almost two more years. A trend that is repeated in other cities with similar characteristics.

“The division of Spain into two halves is evident: the communities that are located from Madrid to the north maintain low rates of poverty and/or social exclusion and, except in a few cases, perfectly compatible with those of the most advanced European countries, and, on the contrary, those located to the south, register extraordinarily high rates and well above the national average, ”says the report The state of poverty of 2021 What does the EAPN do? (European Anti-Poverty Network).

“If compared to Arope (acronym for a recognized indicator of poverty and exclusion), the lowest rates are in Navarra and the Basque Country, with 12% and 13.9%, respectively. On the other hand, the highest are registered in the Canary Islands and Extremadura, with 36.3% and 38.7%, respectively”, he adds.