Spain's hospitality sector, encompassing hotels, restaurants, and cafes, which contributes 6.7% to the national GDP, reported a 0.7% decrease in business turnover for March compared to the previous year.

This downturn is attributed to adverse weather conditions and the timing of the Easter holiday.

Peio Arbeloa, president of the Horeca Committee of the Association of Manufacturers and Distributors (Aecoc), conveyed a generally stable outlook for the sector, although it did not perform as strongly as hoped during this period.

Despite the decline in turnover, employment within the hospitality sector is on an upward trajectory, reaching approximately 1.8 million workers in 2024—a 5.4% increase from the previous year.

Arbeloa indicated that this growth trend suggests the sector may see record employment figures again in 2025. In April, employment figures approached 1.9 million, with seven out of ten contracts being indefinite, reflecting a trend towards professionalization in the industry.

Spain is positioned as a gastronomic destination, with tourism expected to remain a significant economic driver.

Aecoc forecasts that approximately 98 million international tourists will spend over €135.8 billion in Spain this year, leading to a tourism sector GDP contribution of around 4%, significantly outpacing the national GDP growth of 2.5%.

Arbeloa emphasized the continued importance of the hospitality sector as a key engine for the Spanish economy and job creation.

However, the industry faces several challenges.

Aecoc reported that 73% of business owners are worried about the loss of households' purchasing power, which directly influences consumer spending in hospitality.

Additionally, regulatory pressures, including a proposed reduction in working hours, have emerged as a top concern for 61.8% of industry leaders, followed by container and waste regulation (26.5%) and urban distribution laws (11.8%).

These regulations are anticipated to impact operational costs and profitability, leading approximately half of the businesses to adjust their commercial strategies to manage these increasing costs.

Furthermore, 90% of companies are either implementing or considering technologies to improve internal efficiencies.

While some businesses maintain a cautious approach towards the current environment, 36% express optimism for the year 2025. Consumer priorities indicate a shift, with 53% focusing on regaining purchasing power, 26.7% seeking leisure activities, and 20% emphasizing health and wellness.

The hospitality sector remains a pivotal aspect of social interaction in Spain, with eight out of ten individuals visiting bars or restaurants, and 63% dining out as frequently or more than in the prior year.

Nonetheless, economic pressures have led to changes in consumer behavior, with two out of ten cutting back on spending in hospitality due to economic downturns or as a cost-saving measure.

Despite high prices, 45% of consumers continue to prioritize dining out as a means of escapism.

Consumers have adopted various strategies to manage their spending while maintaining their dining habits, such as attending venues during less busy times or opting for set-price menus.