Published on
December 21, 2025
Spain’s Majorca is grappling with a significant tourism downturn as visitor numbers from its key markets, Germany and the UK, decline due to rising travel costs and labor shortages. These issues are putting immense pressure on local businesses that rely on foreign tourists, with the island facing economic uncertainty as it struggles to maintain growth amidst a challenging environment. Despite a steady demand for tourism, the island is now forced to adapt its model to cope with these ongoing pressures, which threaten its status as a top travel destination.
Businesses in Majorca have raised significant concerns over the health of the island’s two primary foreign tourism markets—Germany and the UK—highlighting issues that could have far-reaching impacts on the local economy. The Confederation of Balearic Business Associations (CAEB) has pointed out several ongoing challenges in the tourism industry, including labor shortages and declining visitor numbers from these key markets.
In December 2025, the CAEB drew attention to these issues, noting that while employment figures have remained strong throughout most of the year, businesses are still struggling to attract sufficient workers to meet demand. Despite relatively high employment levels across the island, certain sectors, particularly in the tourism industry, are unable to find the necessary workforce. This shortage has become one of the pressing concerns for the local economy, affecting not only hotels and restaurants but also other service-based industries dependent on tourism.
The organization emphasized the need for diversification within the tourism model. However, it also stressed that this does not mean reducing the size of the tourism sector but rather improving its quality and sustainability. The focus is now on ensuring growth that is both profitable and sustainable, which includes adapting to changing tourism demands and tackling issues such as staffing and over-reliance on certain markets.
Germany and the UK have long been Majorca’s largest sources of international visitors, with Germany historically leading in visitor numbers. Yet, the data for 2025 has shown troubling trends, with a noticeable decline in the number of German visitors. The primary factor contributing to this downturn appears to be price sensitivity. As the cost of traveling to Majorca continues to rise, German tourists, in particular, are reconsidering their travel plans.
The figures for July 2025 showed an overall decline of 0.8% in the number of visitors to Majorca compared to the same month in the previous year. German tourism saw the sharpest drop, decreasing by 8.6%, while UK tourism fell by 2.2%. This represents the third consecutive month of decline in German tourist numbers, while UK arrivals showed a brief uptick in May before falling again in the subsequent months.
Peguera, a well-known resort area just 17 miles west of Palma, has been particularly affected by the drop in German tourism. The area, often referred to as “Germany on Sea” due to its popularity with German visitors, has seen fewer tourists from the country this year, primarily because of the rising costs of travel. The increased prices for everything from hotel stays to flights and car rentals have deterred many from making the trip.
Turespaña, Spain’s national tourism institute, also noted a decline in German bookings for Majorca. This trend was far more noticeable in the Balearic Island than in other parts of Spain. Turespaña attributed the decrease in German tourism to price sensitivity, with German travelers now finding the rising costs of package deals, hotel rooms, car rentals, and other services unaffordable. While the volume of German visitors remains significant, the demand is more vulnerable to price increases.
The third-quarter results for Majorca in 2025 showed a slight increase of 3.2% in comparison to the previous year. However, this was a drop from the 3.3% increase in the second quarter and the 3.6% increase observed in the same period in 2024. Although the growth was small, it still exceeded the Spanish national average, signaling that Majorca’s tourism sector is performing well compared to other regions.
Despite the challenges posed by price increases and labor shortages, there is optimism for the future. The CAEB believes that, with strategic investments in training and productivity, the tourism industry in Majorca can continue to grow, although it will require a more sustainable and diversified approach. Although the tourism model on the island has relied heavily on certain markets, there is a clear shift toward attracting visitors from a broader range of countries, particularly those with more disposable income.
There is also a growing recognition that the current tourism model in Majorca needs to evolve to meet the changing preferences of travelers. Rather than focusing on the sheer number of visitors, the island is looking to enhance the quality of tourism experiences, offering unique and high-value offerings to attract more discerning travelers. This includes focusing on high-end luxury experiences, eco-tourism, and cultural tourism that will appeal to visitors seeking more than just traditional beach holidays.
While the decline in German and UK tourism has created some short-term challenges, it also presents an opportunity for the tourism sector to reimagine its future. Instead of continuing to rely on traditional markets, Majorca can invest in diversifying its appeal to other European countries, as well as to markets in North America, Asia, and beyond.
The overall outlook for Majorca’s tourism industry remains cautiously optimistic. While there are still significant challenges ahead, particularly in terms of staffing and price sensitivity, the island’s long-standing popularity as a vacation destination, combined with its unique attractions, will likely continue to draw visitors. The focus now is on improving sustainability and ensuring that the growth in tourism over the coming years is both economically and environmentally beneficial.
In conclusion, Majorca’s tourism sector faces a number of hurdles, including labor shortages and decreasing numbers of visitors from its primary markets. However, the island is well-positioned to overcome these challenges by diversifying its tourism offerings, attracting new markets, and focusing on sustainable growth. While there is uncertainty in the short term, the outlook for 2026 remains positive, with Majorca set to continue as a leading travel destination in Spain.
