A decade of resilience: foreign capital drives Madrid’s labour market

Foreign capital continues to reshape the economic landscape of Madrid. The latest figures from Spain’s Registry of Foreign Investment—overseen by the Secretariat of Trade under the Ministry of Economy, Trade and Enterprise— highlight the growing influence of foreign-owned companies in the region’s labour market.

By the end of 2023, Madrid registered 692,805 jobs linked to foreign direct investment (FDI), marking a 15.5% increase over the previous year. This growth crowns a decade-long trend: since reaching a low point in 2014, employment generated by foreign-controlled firms in the region has climbed steadily—withstanding even the COVID-19 disruption in 2020. Compared to 2007, these jobs are now 77% higher in number.

Madrid’s performance stands out nationally. The region was responsible for over half of the total increase in FDIlinked employment across Spain last year. It now hosts 33.5% of all foreign investment-related jobs in the country, consolidating its status as Spain’s foremost destination for international capital.

Equally telling is the ratio of these jobs to Madrid’s broader workforce: in 2023, employment tied to foreign-owned firms accounted for 20.7% of the region’s total employed population—a clear sign of international investment’s growing weight in the local economy.

It’s important to note that these employment figures come from the annual reports filed by foreign-controlled companies operating in Madrid. Businesses have up to seven months after closing their books to submit this information, and the subsequent processing and harmonisation of data typically takes additional time. As a result, the most recent data available corresponds to the 2023 financial year.

The key investors: traditional partners lead the way

Investment in Madrid is concentrated among a core group of countries. In 2023, the top ten investor nations accounted for 86.5% of all employment generated by foreign-owned firms in the region.

France remained Madrid’s largest investor, responsible for 166,927 jobs—24.1% of the total—following a 9.8% year-onyear increase. The United States came second with 128,934 jobs (18.6%), bolstered by strong growth in the information technology sector. The UK followed with 87,526 jobs, after adding more than 27,000 new positions in just one year— mainly in the food and beverage services industry.

Germany (67,414 jobs, 9.7%) and Mexico (30,617, 4.4%) rounded out the top five. The remaining top-ten investors included Switzerland (26,957), Spanish companies’ foreign affiliates (24,842), the Netherlands (24,668), Italy (22,591), and Sweden (18,908).

In absolute terms, U.S. companies created the largest number of new jobs in Madrid in 2023—over 30,000—driven by surging demand for IT services. British firms followed with 27,192 additional roles, as the region’s hospitality sector expanded. French companies added nearly 15,000 jobs, with notable gains in warehousing and transport-related activities, facilities management, and healthcare.

Dutch firms created more than 8,000 jobs, particularly in administrative services and civil engineering, while Swissowned companies added nearly 8,000 roles—rebounding after a dip in 2022, especially in employment services.

On the other end of the spectrum, employment declined among affiliates of Spanish multinationals abroad (-4,755), largely due to reporting changes linked to Ferrovial’s relocation to the Netherlands. Luxembourg (-3,663) and Mexico (- 3,190) also saw declines.

It’s important to interpret these shifts with caution. Not all job increases or losses reflect real changes in economic activity. Some may be due to changes in company ownership—where control shifts from one country’s investor base to another—or to variations in how employment figures are reported to the Registry (e.g., average annual employment vs. year-end headcount), which can significantly affect sectors with seasonal or project-based employment.

A service-driven economy: where international firms are hiring in Madrid

In sectoral terms, foreign-owned firms in Madrid are heavily concentrated in services. This category represented 80.2% of all FDI-related employment in the region in 2023, far ahead of industry (15.5%), construction (4.2%), and the primary sector (0.1%).

The top-employing sectors included retail (82,523 jobs, 11.9%), IT consulting and programming (74,606, 10.8%), and wholesale trade (55,614, 8.0%). The hospitality sector—particularly food and beverage services—also stood out, with 50,397 jobs (7.3%), reflecting both domestic consumption and Madrid’s strong tourism recovery.

Other notable sectors were storage and logistics (22,404 jobs, 3.2%) and healthcare services (22,196, also 3.2%). More than sixteen sectors each employed over 10,000 people in 2023, showcasing the diversity of the region’s foreign investment landscape.

This broad sectoral footprint suggests that Madrid has successfully positioned itself as a versatile destination for international business—not only as a hub for consumer services and retail, but also for knowledge-intensive activities like software, engineering, and logistics.

The capital’s appeal is underpinned by its strategic geographic location, robust infrastructure, large and skilled labour pool, and institutional links to Latin America and other European markets. Business-friendly regulations, legal certainty, and high-quality urban amenities further enhance Madrid’s attractiveness for multinational firms seeking long-term returns.

Outlook: Madrid’s international identity grows stronger

The new data reinforces the centrality of foreign investment to Madrid’s economic model. With more than one in five jobs in the region now tied to foreign-controlled firms, the role of international capital in shaping the city’s future is more pronounced than ever.

Amid a shifting global landscape marked by geopolitical uncertainty and evolving supply chains, Madrid continues to provide stability, scale, and a dynamic environment for global investors. The challenge moving forward will be not only to retain this trust, but to channel it into high-value, sustainable employment across even more sectors.

As global corporations deepen their commitment to Madrid, policymakers and businesses alike will need to ensure the region remains an open, competitive, and innovative environment. For now, however, the data speaks volumes: international investment isn’t just present in Madrid—it’s driving the city’s economic momentum.