Malaga to once again be announced as Andalusian province with highest economic and employment growth this year

Malaga will once again be the Andalusian province leading economic and employment growth this year, according to estimates published on Thursday by Analistas Económicos de Andalucía, part of the Unicaja banking group. Forecasts anticipate that the GDP of the Costa del Sol will have expanded at a rate of 3.7%, above the Andalusian 3% average, which in turn exceeds the figure forecast for Spain (2.8%) or that which the Bank of Spain forecasts for the country as a whole (2.6%).

The other provinces that will also beat the Andalusian average will be Granada (3.4%) and Seville (3.2%). The most modest growth will come from Cordoba (2.3%).

These figures show a slowdown with respect to the figures for 2024. For example, the expansion of the Andalusian economy will fall to the aforementioned 3% from 3.6% in 2024. Meanwhile, the economy of Malaga will cool down from 4.4% last year to 3.7% in 2025. According to the study, the region's growth in the first half of the year has been sustained by the favourable contribution of domestic demand, although a moderation has been observed due to what experts describe as a "mild" slowdown in household consumption.

This cooling of which Analistas Económicos de Andalucía speaks, has already been observed in the first half of the year - a period for which reliable data is now available. There are provinces that have been able to stop the slowdown: Cadiz, Granada and Huelva. Once again, Malaga has recorded the highest growth in the region: 4% year-on-year, above the Andalusian 3.4%, a figure which is also higher than the national average.

In any case, it seems that the slowdown in economic activity in the first half of the year has been less significant than expected, since the growth of activity so far this year has allowed Analistas Económicos de Andalucía to revise upwards its growth forecasts from the 2.5% it estimated six months ago to the current forecast of 3%. The company allows the possibility that Andalucía could exceed this growth rate by the end of the year, in view of the latest information available.

The report also provides forecasts for the coming year for Andalucía as a whole, although not by province. In 2026, the region's growth rate could moderate to 2%, a figure very similar to that calculated for Spain as a whole. In fact, Analistas predicts that economic growth is likely to slow in the coming quarters due to trade tensions, which continue being one of the main sources of risk to growth observed by economists.

The greater dynamism of Malaga's GDP is reflected in employment. The number of workers affiliated to social security has increased throughout Andalucía. But once again it is Malaga which recorded the most notable increase: 3.3% in year-on-year terms, followed by Huelva (2.7%) and Seville (2.4%) and above the Andalusian figure of 2.5%. Granada and Cordoba recorded more moderate rises, with rates of under 2%.

As Felisa Becerra, head of the economic analysis department of Analistas Económicos de Andalucía, points out, Malaga is the only Andalusian province in which social security enrolment has risen by more than 3%. In addition, Becerra, also highlights that exports are performing more favourably here, with a boost in chemical products and capital goods, although agri-food goods, which account for half of the province's sales abroad, are affected by the fall in the price of oil.

Although employment in terms of social security enrolment shows a better development in Malaga than in the rest of the Andalusian provinces, there are other metrics in which the province does not fare so well. The workforce survey, for example, reflects a higher growth in Huelva (5.9%) and Jaén (3%), although Malaga, with its 2.6%, beats the Andalusian average, which is around 2%, and also Seville, with a growth of 0.5%.

The report also analyses the behaviour of employment by sector: in Huelva, agriculture and services are the main drivers; in Jaén, agriculture and construction; while in Malaga, services lead the way.

Another metric in which Malaga does not perform so well is the unemployment rate, as it is the only province in which it has risen this year. Malaga's unemployment is below the Andalusian average, but above the Spanish average. The latest figures also reveal that there is one Andalusian province with lower unemployment than Malaga: Huelva, where it is below 10%.

Regarding the property market, the figures for approved housing projects (which are a leading indicator of activity) show a year-on-year increase of 27.7% up to May, exceeding 14,000 in the first five months of the year. Sevilla and Malaga also stand out, accounting for 43% and 26%, respectively.

Meanwhile, in terms of property demand, sales and purchases are growing at a rate of 20.8% year-on-year - a generalised increase in all provinces, although the increase in Malaga is more moderate (11.5%). This does not prevent the province from retaining a very significant weight in activity: one in every four sales made in Andalucía take place in Malaga. It is on the Costa del Sol where mortgages are most expensive: the average mortgage is around 208,000 euros, compared to 91,000 in Jaén, for example. This is due to the fact that the average price per square metre in Malaga is 2,708.4 euros, compared to the Andalusian average of 1,741.4 euros.