Balearic Islands
The Balearic Islands is the most dynamic region in Spain. According to CaixaBank Research, the Balearic Islands’ GDP grew by 4.0% in 2024, above the Spanish average (3.2%). This was thanks to the upturn in tourism, which, in turn, boosted job creation. Despite our forecasts pointing to a slowdown in 2025, with GDP rising by 2.9%, it will remain above the Spanish average (2.4%).
- The Balearic Islands, with 1.24 million inhabitants, 2.5% of the national total, is the twelfth-largest region in demographic terms. It is the youngest region, as only 16.9% of its population is over 65 years old (national average of 20.7%).
- With a GDP of 42.084 billion euros, it also ranks 11th among the autonomous communities and contributes 2.8% of Spain’s GDP.
- Its GDP per capita is 34,381 euros, ranking it in sixth place, 11.0% above the Spanish average. In recent years, it has widened the gap with average GDP, thanks to strong economic growth accompanied by rapid population growth.
- The Balearic Islands’ productive sectors are notable for the higher relative importance of trade, transportation, hotels and restaurants, and leisure (42.1% of the region’s GDP, 14 points higher than in Spain) and construction (8.4% vs 5.9%). In contrast, it is the region where the manufacturing industry provides the smallest share of GDP (2.4% vs 11.9%).
- In line with the less prominent role played by industry, the proportion of exports of goods in the Balearic Islands’ GDP (5.7%) is the second lowest of all regions, with its main exports being chemical products (29.5% of the total) and energy products – fuel for aircraft and ships – (29.6%). However, exports of tourism services are especially notable: in 2024, foreign tourists spent a total of 20 billion euros in the Balearic Islands, 15.9% of their total spending throughout Spain. Moreover, tourism directly and indirectly contributed more than 40% of the Balearic Islands’ total GDP.
Table of structural indicators
|
|
1993 |
2003 |
2013 |
2023 |
|||
|
GDP per capita |
Euros |
12,322 |
22,109 |
23,719 |
34,381 |
||
|
100 = Spain |
122.5 |
116.2 |
107.7 |
111.0 |
|||
|
Population |
Thousands of inhabitants |
744 |
913 |
1,107 |
1,232 |
||
|
Average annual growth over the decade (%) |
1.0 |
2.1 |
1.9 |
1.1 |
|||
|
% of total in Spain |
1.9 |
2.1 |
2.4 |
2.5 |
|||
|
% of population > 65 years old |
14.2 |
14.0 |
14.9 |
16.7 |
|||
|
Exports of goods as a proportion of GDP |
% |
… |
4.9 |
3.2 |
5.7 |
||
|
|
The Balearic Islands is the most dynamic region in Spain. According to CaixaBank Research, the Balearic Islands’ GDP grew by 4.0% in 2024, above the Spanish average (3.2%). This was thanks to the upturn in tourism, which, in turn, boosted job creation.
Despite our forecasts pointing to a slowdown in 2025, with GDP rising by 2.9%, it will remain above the Spanish average (2.4%). Although the tourism industry will continue to be the main driver of growth, the upswing will gradually run out of steam, which explains the slowdown in activity. There are also problems with overcrowding and a shortage of labour. Other challenges faced by the region include problems with access to housing and stagnating productivity. On a positive note, falling interest rates and easing inflation will boost household spending.
The Balearic Islands are among the regions with the best-performing labour markets. In 2024, the number of registered workers affiliated to Social Security rose by 3.3% (2.4% on average across Spain) and, this year, the positive trend is continuing, as it remains above average (3.2% year-on-year in April vs. 2.3%), mostly thanks to the upturn in employment, education, hotels and restaurants and transportation. In terms of the unemployment rate, which is highly seasonal, it stood at 14.8% in Q1 2025, 3.4 points above the Spanish average, but well below the usual figure for Q1 (19.8% on average in 2014-2019).
Now that the pandemic is over, tourism is seeing a huge boost. In 2024, total overnight stays (domestic and foreign tourists) and the number of foreign tourists arriving on the islands reached record highs. They are continuing to perform strongly this year: In the case of foreign tourists, 810,000 arrived in January-March, spending just over 1 billion euros, representing growth of 3.6% and 8.7% year-on-year, respectively.
After recording the highest rise in regional consumption last year, in 2024 the volume of retail trade sales suffered a sharp slowdown and practically stagnated (0.1% vs. 2.1% in Spain). This slowdown continued into the first few months of 2025, with growth of just 0.3% year-on-year up to March, 2 points lower than the country as a whole. Meanwhile, passenger car registrations performed better, rising by 7.5% in 2024 and 12.8% year-on-year in January-April this year, above the average in both cases (7.1% and 12.2%, respectively).
There has been a sharp correction in activity in the housing market in recent years. The Balearic Islands is the region where sales are falling most sharply, by 20% in 2023 and 4% in 2024; it should be noted that foreign buyers play a key role in this market (accounting for just over 30% of all sales). In terms of prices, the market has again tightened and prices are growing at a fast pace, but without reaching the double-digit figures recorded in 2022 (6.6% year-on-year in Q4 2024).
Table of indicators
|
|
2014-2019 average |
2020 |
2021 |
2022 |
2023 |
2024 |
2025 |
Latest figure |
|
|
Activity and prices |
Real GDP* |
3.3 |
–22.7 |
11.5 |
16.1 |
5.7 |
4.0 |
2024 |
|
|
2.8 |
–10.9 |
6.7 |
6.2 |
2.7 |
3.2 |
||||
|
Retail trade |
3.5 |
–14.1 |
9.2 |
8.7 |
5.9 |
0.1 |
0.3 |
March-25 |
|
|
2.3 |
–5.2 |
3.6 |
0.8 |
2.9 |
2.1 |
2.3 |
|||
|
Industrial production index |
–1.6 |
–20.9 |
11.2 |
12.3 |
–1.2 |
–4.3 |
8.3 |
March-25 |
|
|
1.8 |
–9.2 |
7.1 |
2.3 |
–1.6 |
0.7 |
1.5 |
|||
|
Service activity index |
5.6 |
–37.8 |
70.6 |
21.0 |
14.2 |
6.9 |
4.6 |
March-25 |
|
|
5.1 |
–15.6 |
22.0 |
18.3 |
2.2 |
3.0 |
5.3 |
|||
|
Consumer price index |
0.8 |
–0.3 |
3.3 |
8.1 |
3.9 |
2.9 |
2.8 |
April-25 |
|
|
0.7 |
–0.3 |
3.1 |
8.4 |
3.5 |
2.8 |
2.2 |
|||
|
Labour market |
Registered workers affiliated to Social Security |
4.5 |
–9.3 |
2.5 |
10.7 |
4.8 |
3.3 |
3.2 |
April-25 |
|
3.2 |
–2.1 |
2.5 |
3.9 |
2.7 |
2.4 |
2.3 |
|||
|
Registered workers affiliated to Social Security not affected by furlough |
4.5 |
–25.0 |
14.7 |
19.0 |
5.8 |
3.6 |
3.4 |
April-25 |
|
|
3.2 |
–9.2 |
7.3 |
7.3 |
3.4 |
2.7 |
2.5 |
|||
|
Unemployment rate |
14.6 |
16.2 |
14.4 |
10.7 |
10.5 |
9.5 |
14.8 |
Q1 2025 |
|
|
18.8 |
15.5 |
14.9 |
13.0 |
12.2 |
11.3 |
11.4 |
|||
|
Unemployment rate for under 25s |
36.5 |
42.0 |
34.0 |
23.9 |
21.3 |
24.1 |
27.5 |
Q1 2025 |
|
|
42.5 |
38.3 |
44.5 |
24.4 |
28.8 |
24.1 |
26.5 |
|||
|
Public sector |
Public deficit |
–0.8 |
0.2 |
1.0 |
0.1 |
0.3 |
0.3 |
–– |
2024 |
|
–0.9 |
–0.2 |
0.0 |
–1.1 |
–0.9 |
–0.1 |
–– |
|||
|
Autonomous Communities public debt |
28.5 |
34.2 |
29.5 |
23.9 |
20.4 |
18.8 |
–– |
Q4 2024 |
|
|
23.9 |
26.9 |
25.3 |
23.1 |
21.7 |
21.1 |
–– |
|||
|
Real estate market |
Housing prices |
6.8 |
4.1 |
5.8 |
9.2 |
4.1 |
6.6 |
–– |
Q4 2024 |
|
5.3 |
2.1 |
3.7 |
7.4 |
4.0 |
8.4 |
–– |
|||
|
Housing sales |
8.5 |
–23.3 |
32.6 |
25.7 |
–20.4 |
–3.7 |
22.2 |
March-25 |
|
|
9.7 |
–16.9 |
34.8 |
14.8 |
–10.2 |
9.9 |
20.7 |
|||
|
Foreign sector and tourism |
Exports of goods |
14.8 |
–11.8 |
10.4 |
45.3 |
–8.3 |
10.6 |
16.8 |
March-25 |
|
3.9 |
–9.4 |
20.1 |
22.9 |
–1.4 |
0.2 |
2.6 |
|||
|
Tourist overnight stays |
1.6 |
–88.8 |
301.7 |
111.9 |
5.1 |
7.1 |
–5.6 |
March-25 |
|
|
3.0 |
–69.2 |
78.3 |
73.3 |
7.1 |
4.4 |
–2.9 |
Note: *The 2024 GDP figure for Autonomous Communities is an estimate made by CaixaBank Research.
Source: CaixaBank Research, based on data from the National Statistics Institute (INE), the Bank of Spain, the Ministry of Labour, Migration and Social Security (MITRAMISS), the Ministry of Finance and DataComex.
Below we show a series of charts comparing the main indicators for the various regions.