By Andrew Ede

Copyright majorcadailybulletin

The latest economic report from the Confederation of Balearic Business Associations (CAEB) indicates that the Balearic economy grew by 3.3% in the second quarter of this year, above the national average (2.8%) and twice as much as the European average (1.6%).

Balearic growth typically does outperform that for the country as a whole. For example, in the first quarter of 2025, months not characterised by high tourism activity, there was 3.4% growth; the national figure was 2.8%.

However, a slight fall compared with the first quarter leads the CAEB to believe there is a “loss of intensity”. The confederation’s president, Carmen Planas, warns that there are signs of exhaustion for an economic model based on the accumulation of natural, human, and physical resources and that the current growth pattern “is reaching its ceiling”. “As in 2024, the economy has lost strength during peak months despite record visitor numbers.” For her, productivity needs to be prioritised: “Promote innovation, accelerate technological adoption, focus on regenerative tourism, and diversify towards strategic sectors.”

The CAEB reports points to record employment in June – 661,096 people in work – and a fall in the unemployment rate to 3.8%.

More up-to-date than June, Spain’s tourism agency Turespaña published its report on August employment in the tourism sector. This pointed to a 1.8% increase in Balearic employment, a total of 188,438 people in work in the sector, which comprises hospitality, travel agencies and tour operators.