State pays 500,000 more people than private sector

Half a million more people receive state funds than work for a company

According to a calculation circulating in the debate, a worker contributing 996 euros monthly for forty years would have handed over roughly 440,000 euros to Social Security; if they retire at 67 and die at 71, that money would barely cover four years of pension. This arithmetic underpins any discussion on who supports whom in Spain, and the latest count shows a broken balance: 18.21 million people receive state funds and 17.69 million work for a company. A difference of half a million. And growing.

18.21 million receiving state funds versus 17.69 million in private employment

The figure for recipients includes pensioners, unemployment benefit recipients, dependency allowance recipients, and Minimum Vital Income beneficiaries, in addition to public payrolls. On the other side is private employment as recorded by the INE, a count including salaried employees in companies, self-employed employers, independent workers, and business owners without employees. The gap between these two blocks has continued to widen: contributory pensions have risen by 11% since 2014 and the public workforce has grown precisely during the years when private employment plummeted.

There is a nuance worth keeping in mind. A worker does not automatically equate to a net contributor, nor does a recipient to a salary. But the direction of the graph allows few alternative readings: the block living off public funds comprises more people than the one living from selling goods.

From fewer than one million public employees to 3.5 million

According to the review made by a participant, in the 1980s the administration operated with fewer than one million public employees and not a single computer; now the workforce would be around 3.5 million. The growth of the public sector has compensated for private employment declines in bad years, and has done so with an uncomfortable paradox: there are increasingly more staff and more precarious conditions. More people, worse contracts.

The question looming over any analysis of public accounts is obvious. If the country functioned with one million fewer employees and no computers, what has been gained exactly by multiplying the structure by three and a half?

Why is the pension system said to be in deficit?

Because it is a pay-as-you-go system, not an individual savings account: what is contributed in one year is paid that same year to those already retired. This design has a logical consequence that some state bluntly: for every pensioner who dies without having exhausted what they contributed, there are ten still receiving benefits after having consumed their share. With this starting point, the imbalance is not a management accident. It is the norm.

In this framework, a participant proposes individual capitalization, the so-called Austrian backpack, with each worker keeping their own separate account. Life expectancy does the rest.

How many years of contributions are taken into account to calculate the pension?

As many as necessary, but increasingly more. A participant reviews the evolution: in the 1980s the calculation was based on the last two years of contributions; with Felipe González it was extended to eight; with Aznar, to fifteen; then came twenty-five. The criticism accompanying this change is that the longer the calculation base, the lower the pension, because good years are diluted among bad ones.

The contrast with the environment repeats in any comparison. In France, the twenty-five best years of one's entire working life are taken, with forty-two years of contributions required, compared to thirty-eight in Spain. The most widespread complaint is not the number of years, but which ones are chosen.

The private sector that also lives off the public budget

Here appears the nuance that disconcerts half of Spain: the private sector is not always so private. Gardening, buses, trash collection, maintenance, technology consultants. There are companies whose only real client is the State, via contract or subsidy. They belong to the same organism, just with an invoice.

This is summarized by an image circulating in more critical analyses: the day the public bubble bursts, it is not only the public employee who falls, but also their hairdresser. State spending generates demand, and that demand sustains businesses that would not exist without it.

46% of Social Security affiliates are already over 45 years old

This is the number that should keep any manager awake. Nearly half of affiliates are over 45 years old, five points more than a little more than half a decade ago. With the baby boom generation entering the system in bulk, reforms do not avoid the problem: they postpone it for a few years.

Local data go in the same direction. In a Basque industrial town, according to the count cited by a participant, the active population stands at 50.2% and the employed at 43.5%, with the female activity rate hovering around 40%. In that same municipality, half of the employed would be civil servants. Few people producing and many receiving what others produce.

With this trend, the discussion is no longer whether something will have to change, but where the cuts begin. And the 46% of affiliates over 45 years old is not a prediction: it is the present.