Spain Under Franco: Economy and Society (1939-1970s)
From 1939 to 1959, the first phase of the Franco dictatorship developed, characterized by political and ideological reaction against the modernization work that began in the Second Republic. Franco concentrated all power and exerted strong control over the various sectors that supported the system while developing strong repression against the losers of the Civil War. Moreover, the regime sought to improve the economic situation and achieve broad social support.
Economic Evolution
The new government was formed by technocrats, people with economic training linked to Opus Dei. Autarkic and interventionist policies led the country into a severe economic situation. In 1959, the law approving the New Economic Order, also known as the Stabilization Plan, aimed at liberalizing the economy. This new economic policy aimed to eliminate previous problems (inflation, unemployment, low living standards, etc.). At first, the Stabilization Plan increased unemployment and caused the closure of some companies, but integration into the OECD helped alleviate this problem and facilitated the emigration of 3 million Spaniards to other European countries like Germany, France, Switzerland, and Holland.
The shift in economic policy led to an economic miracle thanks to international loans, investments in companies like Citroën, Renault, etc., and foreign exchange earnings through increased exports, tourism, and remittances from migrants. This investment resulted in high GDP growth during the 1960s.
The government launched development plans. The state promoted private investment with cheap credit and subsidies. It created development centers, thus renovating and establishing industries in new industrial cities.
With this industrialization, Spain modernized, but this growth generated imbalances; other areas remained backward and sparsely populated. The crisis of the 1970s slowed this expansion phase.
Social Changes
The rightist victory in the Civil War led to a decline in many aspects of life. Socially, the landowners recovered such dominance that it seemed like a return to the time of Cánovas. Nevertheless, the economic changes led to major social transformations.
The population grew by 30% between 1940 and 1970; mortality declined, the birth rate remained high until the 1970s, and the 1950s saw the beginning of a strong rural exodus. Along with emigration, this was one of the most important demographic processes. Emigration destinations varied. Internally, the Basque Country received migrants from the northern half of Spain, Madrid from Extremadura and the Two Castiles, and Aragon and Barcelona from the east and south. This growth culminated in urbanization and population concentration.
The old oligarchy lost influence under the hegemony of the financial bourgeoisie. An industrial and commercial bourgeoisie developed and consolidated its power, aligning with European trends. The middle class grew. Along with the small and medium bourgeoisie, new middle classes appeared, linked to technical and economic modernization.
The working class gained crucial importance due to industrialization, increasing from 25% to 35% of the population. This class developed the capacity for struggle and exerted strong pressure against the regime through instruments such as workers’ committees. Employees in the service sector also joined the working class.
The rural population lost land due to the rural exodus but saw improved living standards due to rising wages for laborers and farmers increasing the size of their holdings.
Women lost the progress made during the Second Republic and were again subordinate to men.
The success of the Stabilization Plan led to a relaxation of the dictatorship’s repressive controls. In this context, the new Minister of Information, Fraga, approved a press law in 1966. In 1967, the Organic Law of the State was approved, and finally, in 1969, Franco named Juan Carlos his successor. Political factions emerged, known as ‘aperturistas’ (reformers) and ‘inmovilistas’ (hardliners).