Latest figures from the Balearic Statistics Institute show that there were 30,017 businesses in Mallorca in the first quarter of 2024, a record number for a first quarter of the year and over 1,000 more than for the same period of 2023.
While the number of businesses does reflect a regional economy in reasonably good shape, the president of the CAEB Confederation of Balearic Business Associations, Carmen Planas, says that it hides the constant loss of productivity over recent years.
Planas and the CAEB have consistently made this point, they and others having highlighted the fact that per capita income in Mallorca and the Balearics has been on the slide since the start of the century.
In the EU regional table, the Balearics ranked 46th in 2001; the islands are now 110th. Antoni Riera, technical director of the Fundació Impulsa for Balearic competitiveness, has said: "The islands continue to grow ... but not because our ability to generate value increases. The result is that average income tends to erode." A lack of productivity is the main economic problem facing the Balearics.
Various reasons have been offered to explain this, one being an economy that is predominantly focused on services, which places sectors such as tourism and retail firmly in the frame. Of the 30,000+ businesses in the first quarter, 5,487 were hospitality businesses; 5,287 were retail, wholesale and vehicle repair. In third place was construction - 5,077 businesses.
Other sectors that fall under the service banner are: professional, scientific and technical activities (2,067); administrative and auxiliary services activities (1,788); "other services" (1,660); transport and storage (1,546); real estate activities (1,098). The list goes on. For manufacturing industry there were 1,696 businesses.
This isn't to say that there aren't services that generate the added value measure of productivity (as Antoni Riera has explained), but there is a preponderance of businesses in service sectors where this added value is highly questionable.