Were wages stagnant for decades? A revision of labor costs and net earnings in Spain (1900–1960)

Abstract

This paper presents a significant revision of the evolution of labor incomes in Spain, challenging previous assumptions about the effect of Francoist institutions in the postwar era. Administrative data reveal weaker wage declines in the 1940s and consistent growth throughout the 1950s, driven by the growing importance of allowances and family bonuses. This more positive evolution primarily benefited workers in regulated industries (such as manufacturing and private services), while agrarian laborers and civil servants experienced subpar earnings growth. Consequently, for the first group, effective compensation increasingly trended above legal compensation, as evidenced by the results of the 1957 wage survey. These findings suggest that labor markets under Francoism had a more flexible compensation structure than previously believed.