What an engineer earned in Madrid in 1992 versus today

An engineer's paycheck in 1992: three times today's

Did filling up the tank really cost that much in 1992? The question only makes sense if you look at the paychecks of the time. An engineer with six years of experience in Madrid earned 615,704 pesetas gross per month before turning 30. Adjusted for cumulative price increases, that paycheck is equivalent to 120,000 euros gross per year in today's money. The same professional profile is paid between 35,000 and 45,000 euros today. Let's just say the calculation needs no rounding: it's less than half, and in some cases a third.

Taxes, the other hole in the pocket

The argument that income tax (IRPF, Spain's personal income tax) was higher back then doesn't hold up. The total burden then, adding IRPF and Social Security, was 27%. Today, on 40,000 euros gross, it comes to 22%. The relevant difference lies in what's left: 87,000 euros net in today's money versus 31,000 euros. Almost three times more disposable income to live in the same city.

Housing and prices that scare

Housing was about three times cheaper. The story going around: in 2003 someone earned 4,500 euros net per month in construction and bought a duplex in the center of their city for 80,000 euros. That apartment is worth 350,000 euros today; that profile's salary has fallen to 1,300 euros net. In the technical sector, freelance rates are also in a league of their own: 98 euros per hour in systems, double for a senior administrator, with contracts of 150,000-200,000 euros a year and a company car.

With these figures there's no need to pick a side in the nostalgia debate. The 1992 engineer literally had three times as much money left. Today a lower percentage is paid in taxes, yes. But it's not enough to buy the apartment. That said: the car weighs more.