Present-day economy Economy of Madrid

1 present-day economy

1.1 aggregated economic activity
1.2 standard of living

1.2.1 income , expenditure
1.2.2 income distribution
1.2.3 impact of recession


1.3 composition of economy sector

1.3.1 services

1.3.1.1 finance , banking
1.3.1.2 transport
1.3.1.3 trade fairs, exhibitions, conferences
1.3.1.4 public sector
1.3.1.5 tourism


1.3.2 industry
1.3.3 construction


1.4 employment
1.5 international rankings

present-day economy

cuatro torres business area (ctba)

as national capital, madrid concentrates activities directly connected power (central , regional government, headquarters of spanish companies, regional hq of multinationals, financial institutions) , knowledge , technological innovation (research centres , universities). 1 of europe s largest financial centres , largest in spain. in 2008, 72% of spain’s largest 2,000 companies had headquarters in madrid. city has 17 universities , on 30 research centres.

although service sector predominates in economy, madrid continues hold position of spain s second industrial centre after barcelona, specialising particularly in high-technology production. location @ centre of peninsula permits articulate long-distance transport networks of peninsula. comparative advantages of madrid have been decisive in capturing larger part of foreign investment coming spain in recent years. third metropolis in eu population, , fourth gross internal product. leading employers include telefónica, iberia, prosegur, bbva, urbaser, dragados, , fcc.

aggregated economic activity

the city of madrid had gdp of €124,780m in 2011. gdp per capita in 2011 74% above national gdp per capita average , 70% above of 27 european union member states. in comparison remainder of madrid region, city substantially richer: although housing on 50% of community of madrid s population, generates 65.9% of gdp. rapid growth - throughout 1990s particularly - converted madrid 1 of prosperous european cities maintained large part of decade of 2000s, growth rate being 3.4% pa 2000-2009. following recession commencing 2007/8, recovery under way 2014, forecast growth rates city of 1.4% in 2014, 2.7% in 2015 , 2.8% in 2016.

in 2009, madrid s per capita gdp lay 11% behind average of top 10 cities of eu (it had been 14% behind in 2000). explained lower rates of employment and, lesser extent, lower labour productivity, madrid catching on both these factors, productivity growing 2.5% pa in real terms.

the region of madrid runs heavily negative balance of foreign trade in every major class of goods: in 2013/14 exports totalled €28.97m, , imports €47.29m.

standard of living
income , expenditure

the mean income per unit of consumption (a weighted count of persons) in 2010 €17,800, 12% above figure spain. similarly, mean annual spending per household in same year €35,683, again 12% above spanish average.

one downside of madrid s rapid economic development since 1992 has been rising cost of living. although residential property prices have fallen 39% since 2007, average price of dwelling space €2,375.6 per sq. m. in 2014, , second london in list of 22 european cities.

income distribution

the proportion classified @ risk of poverty in 2010 15.6%, 13.0% in 2006 less average spain of 21.8%. proportion classified affluent 43.3%, 38.2% in 2006 , higher spain overall (28.6%). gini coefficient, measure of income inequality, less in madrid region (32.3) rest of spain (34.0).

impact of recession

consumption madrid residents has been affected job losses , austerity measures, including rise in sales tax 8% 21% in 2012. impact of economic recession on spending patterns of madrid households seen in household survey in 2009: 74% said building savings, 54% taking more advantage of sales, 47% spending less on clothes, 44% on eating out , 42% on going shows.

composition of economy sector

the economy of madrid has become based increasingly on service sector. in 2011 services accounted 85.9% of value added, while industry contributed 7.9% , construction 6.1%. services business, transport & communications, property & financial account 52% of total value added. following recession, services , industry forecast return growth in 2014, , construction in 2015.

services

the historic dominance of service sector in capital reflected in current trends, share of services in city’s economy growing 82% in 2000 86% in 2011. types of services expanding facilitate movement of capital, information, goods , persons, , advanced business services such research , development (r&d), information technology, , technical accountancy.

azca business park in northern madrid



finance , banking

banks based in madrid, both clearing banks , savings banks, carry out 72% of banking activity in spain. after many recent amalgamations largest banking groups important presence in madrid bsch (banco de santander y central hispano) , bbva (banco bilbao vizcaya argentaria). spanish central bank, bank of spain, has existed in madrid since 1782. stocks & shares, bond markets, insurance, , pension funds other important forms of financial institution operating in city.

transport


autovía a4, spain



ave s-112 @ madrid atocha station

the construction of transport infrastructure, such ring roads , train network, constituted major pillar of economy 2006. road, rail , air links vital maintain economic position of madrid leading centre of employment, enterprise , tourism. 3 quarters of million people commute city work. road network within metropolitan region includes 9 radial autovías (fast dualled highways) , 4 orbital ones @ different distances centre. of more built radial roads tolls charged have not been used capacity. region possesses high-capacity metropolitan road network. however, in of outer areas new orbital roads have favoured dispersion , fragmentation of residential , economically active areas.

madrid has high standard of public transport provision, consisting of metro, cercanías local railways, , dense network of bus routes, many intermodal interchanges. half of journeys in metropolitan area made on public transport, high proportion compared european cities.

in terms of longer-distance transport, construction of autovías in 1980s , 1990s has given madrid direct fast road links parts of spain , france , portugal. madrid central node of high-speed rail network (ave), connecting city 17 provincial capitals , more under construction. high-speed rail has brought major cities such seville , barcelona within 2.5 hours travel , has taken large proportion of journeys formerly made road or air. economic importance of these developments lies not in facilitating business trips in increasing city s access human capital, strengthening competitiveness of madrid-based business.

madrid-barajas airport, fourth largest airport in europe, important component of city s economy, major transport hub, arrival point large tourist trade, , large employer. barajas handles on 40m passengers annually, of whom 70% international travellers, in addition majority of spain’s air freight movements.

finally, madrid’s location @ centre of peninsula makes natural logistical base , focus of international trade. on half value of national transport of goods , logistical operations passes through madrid region. type of activity gradually moving outwards city itself.

trade fairs, exhibitions, conferences

ifema exhibition centre

madrid important centre trade fairs, business exhibitions , conferences, although scale of activity decreased between 2005 , 2011: while there more fairs (82) in latter year, attracted fewer exhibitors (32,800, down 18%) , fewer visitors (739,000, down 27%). many of trade fairs coordinated ifema, trade fair institution of madrid. there 6 conference , exhibition centres, , 64 hotels conference & exhibition facilities.

public sector

in 2012 there 243,000 employees in public sector, or 18.1% of employees. proportion had remained approximately stable since 2005. of these employees 48% working in administration , security, 22% in health, sanitary , social services, , 16% in education.

tourism

a sign @ palacio de cristal (el retiro), madrid

madrid attracts many tourists other parts of spain , on world. there 7.5 million visitors stayed 1 or more nights in madrid in 2013, 49% of whom outside spain. tourist destination madrid exceeds barcelona popular in spain. madrid attractive visitors art , culture, architecture, gastronomy, shopping, shows, parks, sport , proximity sierra de guadarrama. there on 900 hotels , hostels (24 of 5-star hotels) accommodation on 80,000 visitors. in 2012, 54% of foreign visitors europe (especially italy, uk , france), 12% usa, 20% other parts of americas, , 14% elsewhere. spending tourists in madrid estimated (2011) @ €9,546.5m, or 7.7% of city’s gdp. although visitor numbers reported down 10% in summer 2013, possibly due high airport fees , fewer long-haul visitors after merger between airlines iberia , british airways, numbers had recovered 12% year-on-year in months of 2014. madrid precious time new collaborative body aiming @ attracting more tourists city.

industry

telefónica district in madrid

industry still forms significant sector, contributing 7.5% madrid s value-added in 2010. however, industry has declined within city boundaries more industry has moved outward periphery, south/south-eastern arc. city contains 37% (by value) of industry in region. industrial gross value added grew 4.3% in period 2003-2005, decreased 10% during 2008-2010.

the total gdp industry in 2010 €8,497m. leading industries were: paper, printing & publishing, 28.8%; energy & mining, 19.7%; vehicles & transport equipment, 12.9%; electrical , electronic, 10.3%; foodstuffs, 9.6%; clothing, footwear & textiles, 8.3%; chemical, 7.9%; industrial machinery, 7.3%.

madrid retains advantages in infrastructure, transport hub, , location of headquarters of many companies. industries based on advanced technology acquiring more importance here in rest of spain.

construction

the construction sector, contributing 6.5% city’s economy in 2010, growing sector before recession, aided large transport , infrastructure program. more construction sector has fallen away , earned 8% less in 2009 had been in 2000. decrease particularly marked in residential sector, prices dropped 25%-27% 2007 2012/13 , number of sales fell 57%.

employment

participation in labour force 1,638,200 in 2011, or 79.0%: females 74.5%, males 83.9%. more women moved labour force between 2007 , 2011, participation rate increasing 4.2%, while of men increased 0.4%. employed workforce comprised 49% women in 2011 (spain, 45%).

during period 2007-11, unemployment rate increased 6.0% 15.8% (similar in both sexes), remaining lower in spain whole (8.3% 21.8%). among aged 16–24, unemployment rate increased 16.5% 39.6% (spain, 18.2% 46.4%). unemployment reached peak of 19.1% in 2013, start of economic recovery in 2014, employment started increase , more jobs created in city in other region of spain. 47% of registered unemployed people receive unemployment benefit.

employment continues shift further towards service sector, 86% of jobs in sector 2011, against 74% in of spain: during preceding 4 years employment in madrid decreased 25% in industry , 42% in construction, while in services combined employment decreased less 6%, increases of 11% in transport & communication sector, , 11% in public administration, education & health.

ayuntamiento (city hall) of madrid, plaza cibeles

among economically active of madrid in 2011, 41% university graduates, against 24% spain whole. unemployment rate among graduates 8.9%, 3.8% in 2007 less 21.0% school education.

international rankings

a recent study placed madrid 7th among 36 cities attractive base business. placed third in terms of availability of office space, , fifth each of access markets, availability of qualified staff, mobility within city, , quality of life. less favourable characteristics seen pollution, languages spoken, , political environment. ranking of european cities placed madrid 5th among 25 cities (behind berlin, london, paris , frankfurt), being rated favourably on economic factors , labour market, , on transport , communication.