Santiago Businesses Face Closure Crisis as Small Trade Struggles

Santiago – A wave of closures is impacting the city’s small trade sector, raising alarms among business owners and industry advocates. According to recent data, approximately 100 businesses in Santiago have shuttered their doors in the past year, signaling a deepening crisis for local entrepreneurs.

sharp Decline in Small Businesses Spurs Concern

Eduardo Abad, President of the Union of Autonomous Professionals and Workers (UPTA), expressed important worry over the escalating situation. He stated that the increasing number of business closures demands immediate attention and proactive measures to support the struggling sector. The trend, he argues, represents a serious threat to the economic vitality of the region.

Self-Employment Figures Paint a Broader Picture

A UPTA report, analyzing Social security data, revealed that in July 2025, Santiago counted 7,198 self-employed workers. This figure places the region at 6% of the total self-employment numbers across Spain, with Galicia reporting a larger total of 204,970 self-employed individuals as of August 2025. This disparity highlights the challenges faced specifically by entrepreneurs in Santiago.

Shifting Consumer Trends and Administrative Challenges

Abad attributes the closures to a combination of factors, including evolving consumer preferences and perceived shortcomings in local governance policies. He specifically urged the Santiago city Council to invest in pedestrianization projects,believing this could revitalize commercial areas and attract customers.

Calls for Support and Modernization

Despite the challenges, the City Council already has policies in place aimed at promoting self-employment, including affordable coworking spaces. Though, Abad emphasized the need for additional measures and swift action.A key proposal involves integrating online sales with physical stores, allowing customers to order online for in-store pickup, a concept presented to local government officials but, as of yet, receiving no response.

Did you know? According to Statista,small and medium-sized enterprises (SMEs) represent 99% of all companies in the European Union,highlighting the critical role they play in the economy.

Generational Shift and Future Planning

The UPTA is also advocating for a generational relief plan to encourage younger individuals to take over existing businesses or launch new ventures. This initiative aims to address the aging demographic within the entrepreneurial community and ensure the long-term sustainability of small trade in Santiago. Regional authorities are currently exploring similar measures at a broader level.

Key Policy Concerns for the Self-Employed

Looking ahead, the UPTA outlined a five-point “roadmap” for improving the employment situation for self-employed individuals. This includes addressing issues such as the fiscal regime, unemployment benefits, occupational risk law, contribution systems based on actual income, and subsidies for those over 52. Abad pointed out that the current fiscal burden on self-employed workers – exceeding 35% – is significantly higher than the rate for traditional employees, which is under 17%.

Further concerns were raised about the limited access to unemployment benefits and the increasing number of workplace accidents among self-employed individuals. The UPTA is also pushing for modifications to the self-employment contribution system, ensuring it is based on actual income rather than fixed amounts.

Pro Tip: networking with other entrepreneurs and seeking mentorship can provide valuable support and guidance during challenging times.