Madrid AC

Madrid’s economy shrank by 10.6% in 2020 due to the effect of the COVID-19 health crisis. This smaller decline than in the Spanish economy as a whole (–10.8%) was due to less dependence on the tourism sector than the country on average, the relatively strong performance of commercial activity, which recovered quickly after Q2 2020, and positive trends in industrial production and exports.

Content available in
November 5th, 2021
Madrid
6,747,000
inhabitants (2019)
€35,913
GDP per capita (2019)
19.3%
of Spanish GDP (2019)
5.3%
GDP growth forecast (2021)
Regional economic structure and position
  • The Madrid Autonomous Community has the largest GDP. Its higher relative growth has allowed the region to gain importance over the last two decades, increasing its contribution to GDP to 19.3% from 17.7% in 2000.
  • The region has had great demographic dynamism in recent decades thanks to migration flows from abroad and other Autonomous Communities. The Madrid Autonomous Community has a population of 6.7 million inhabitants, 14.3% of the Spanish population.
  • The total GDP per capita stands at 35,913 euros, which is 35.9% higher than the Spanish average. Its position in terms of Spain’s GDP per capita has remained stable since the start of the 19th century, albeit with a slightly upward trend.
  • In terms of production specialisation, it is notable for the relative importance of professional and industry-related services (40.6% vs 28.2% on average in Spain) and the far lesser importance of agricultural and industrial activities.
  • The Madrid Autonomous Community is not highly export-oriented, with exports of goods making up 13% of regional GDP (vs the Spanish average of 23.4%). Despite this, it is the Autonomous Community with the second highest volume of exports of goods.
  • The main exporting sectors are: machinery and electrical material (19.9% of the total), pharmaceutical products (14.3%), cars (10.4%) and aircraft (6.7%).

Table of structural indicators

 

   

1989

1999

2009

 

2019

GDP per capita

Euros

 

9,419

19,703

31,220

 

35,913

100 = Spain

 

126.8

134.8

135.4

 

135.9

Population

Thousands of inhabitants

 

4,937

5,330

6,374

 

6,747

Average annual growth over the decade (%)

 

0.7

0.8

1.8

 

0.6

% of total in Spain

 

12.7

13.2

13.7

 

14.3

% of population > 65 years old

 

4.0

4.5

4.1

 

4.7

Exports of goods as a proportion of GDP

%

 

...

11.1

9.6

 

13.0

 

 
Macroeconomic situation

Madrid’s economy shrank by 10.6% in 2020 due to the effect of the COVID-19 health crisis. This smaller decline than in the Spanish economy as a whole (–10.8%) was due to less dependence on the tourism sector than the country on average, the relatively strong performance of commercial activity, which recovered quickly after Q2 2020, and positive trends in industrial production and exports.

Our forecasts indicate that the Madrid Autonomous Community’s GDP will grow by 5.3% in 2021, putting it 5.9% below pre-COVID levels (compared with 6.4% for Spain as a whole). In the second half of the year, we expect the recovery trend observed in recent months in consumption, employment and industrial and export activity to be consolidated. Furthermore, we estimate that the effect of pent-up demand and the implementation of the NGEU fund will play a significant role
in the recovery.

GDP

Last actualization: 05 November 2021 - 14:37

Employment in the region has remained more buoyant than on average in Spain. In August, the figure for registered workers affiliated to the Social Security was 1.9% higher than it was in 2019, although the number of non-furloughed workers is still slightly lower than it was in the same month in 2019 (–0.1%). The number of furloughed workers has fallen to 53,930, 1.9% of workers affiliated to the Social Security.

Retail trade has been less hard hit by the consequences of the crisis than the country on average. In the first half of 2021, retail and consumer goods recorded growth of 3.4% compared with the same period in 2019 (–3.4% was the Spanish average). The CaixaBank consumption indicator points to a slight slowdown at the end of the summer, as it fell by 1.4% in the first week of September, compared with the same period in 2019.

Industrial production has also performed better than in the country as a whole throughout the crisis, contracting by 6.6% in 2020, which was a smaller decline than the 9.2% average, thanks to the strong performance of the energy sectors. So far in 2021, the region's IPI has fallen by 3.5% compared to 2019.

Exports are also performing better than the national average. In 2020 they suffered a decline of 6.2% (–10.2% in Spain) and, in the first half of 2021, they were 16.2% higher than in the same period in 2019, thanks to the performance of pharmaceutical product exports (+55% vs the same period in 2019).

Madrid's tourism sector is highly dependent on business tourism, whose recovery prospects are slower than they are for holiday tourism. However, the fall in overnight stays between January and July was similar to the Spanish average compared to the same period in 2019 (around –63%).

Registered workers affiliated to Social Security

Last actualization: 05 November 2021 - 14:39

Retail trade

Last actualization: 05 November 2021 - 14:41

Table of indicators

 

 

2002-2007 average

2008-2014 average

2015-2018 average

2019

2020

2021

Latest figure

Activity and prices

Real GDP*
(% year-on-year change)

4.0

–0.5

3.5

2.6

–10.6

2020

3.5

–1.3

2.8

2.0

–10.8

Retail trade**
(% cumulative annual change)

–4.2

3.7

4.8

–2.6

3.4

July-21

–3.7

1.8

2.5

–5.6

–3.4

Industrial production index**
(% cumulative annual change)

3.7

–6.3

2.1

2.3

–6.6

–3.5

July-21

1.9

–4.2

1.7

0.6

–9.2

–4.1

Service activity index**
(% cumulative annual change)

–4.1

7.2

4.0

–18.3

–9.3

June-21

–3.4

5.5

3.9

–15.6

–6.9

Consumer price index
(% year-on-year change)

3.1

1.4

1.1

1.0

–0.4

2.6

July-21

3.1

1.4

1.1

0.7

–0.3

2.9

                 

Labour market

Registered employment affiliated to Social Security**
(% year-on-year change)

4.0

–1.8

3.8

3.4

–1.3

1.9

August-21

3.5

–2.3

3.4

2.6

–2.1

0.8

Unemployment rate
(% active population)

6.8

16.0

14.6

10.6

12.5

12.1

Q2 2021

10.0

20.8

18.5

14.1

15.5

15.3

Unemployment rate for under 25s
(% active population < 25)

15.9

39.8

36.7

29.1

31.8

34.0

Q2 2021

20.4

44.5

41.5

32.6

49.6

38.4

                 

Public sector

Public deficit
(% of GDP)

0.1

–3.9

–1.5

–0.2

–0.1

2020

–0.3

–2.5

–0.8

–0.6

–0.2

Autonomous Communities public debt
(% of GDP)

5.9

8.8

14.4

13.9

16.0

16.5

Q1 2021

6.0

13.8

24.5

23.7

27.1

27.6

                 

Real estate market

Housing prices
(% year-on-year change)

–7.4

10.1

5.9

1.7

1.9

Q2 2021

–6.8

5.8

5.1

2.1

3.3

Housing sales
(% cumulative annual change)

–4.7

13.9

–6.3

–19.8

37.9

June-21

–8.7

13.4

–2.4

–17.2

31.8

                 

Foreign sector and tourism

Exports of goods**
(% cumulative annual change)

7.1

4.0

2.6

4.1

–6.2

16.2

June-21

6.8

4.2

4.5

2.0

–10.2

2.8

Tourist overnight stays**
(% cumulative annual change)

6.7

2.5

4.4

4.9

–68.5

–63.3

July-21

2.4

1.1

3.4

0.6

–69.3

–63.9

Notes: *The 2020 GDP figure for Autonomous Communities is an estimate made by CaixaBank Research. ** The changes from the same period in 2019 are calculated.

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.

Regional comparison

Below we show a series of charts comparing the main indicators for the various regions.

Regional comparison

Last actualization: 27 October 2021 - 10:31