three of which are foreign nationals. going forward, the demographic projections available12 agree that immigration will remain strong over the coming years, with net inflows of between 300, 000 and 500, 000 people in ine, euro stat and airef pro jectio ns fo r the spanish eco no my. 2023, and between 200, 000 and 500, 000 in 2024 and 2025, making this a key determinant of labour force and employment developments in spain. in addition, the progressive ageing of the population has had visible effects on the labour market in the most recent period. indeed, alongside technological progress, population ageing is the other major structural trend that has been influencing the labour market, and one that will do so increasingly in the foreseeable future. population ageing could have ramifications not only in terms of the size of the working - age population and the aggregate level of employment, but also the occupational and sectoral composition of employment. in the near term, changes in the working - age population are shaped entirely by the low birth rates of previous decades and immigrant inflows. for instance, the working - age population has shrunk as a proportion of the total population, a product of the large baby boom generation reaching retirement age, low fertility rates and a steadily increasing life expectancy. needless to say, this population ageing is driving a very marked increase in the relative share of older workers in the working - age population. between 2019 q4 and 2022 q4, the proportion of older persons ( aged 55 - 69 years ) in the labour force grew by 2 %, while that of young persons ( aged 16 - 24 ) climbed by 1 %, spurred by the recovery in employment. meanwhile, the share of adults ( aged 25 - 54 ) shrank by nearly 1. 5 %. this fall was not caused by a declining labour force participation rate, which in fact has followed a trajectory similar to that of the unemployment rate. rather, it was entirely attributable to the shrinking population in the intermediate age group. the recent increase in the participation rate of older individuals is also noteworthy. for instance, in spain the participation rate of the over - 55s has risen by 3 pp since end - 2019, 13 although it remains well below that of the intermediate age group. overall, population ageing is estimated to have reduced the labour force participation rate by just over 3 pp. 14 according to the projections currently

eighth, the significantly moderate wage growth in this period, given the high inflation environment. wage - setting through collective bargaining in spain has undergone two major shocks. one was the slowdown in wage bargaining during 2020 - 2021, associated with the pandemic. the other, more recent shock is the upturn in inflation observed since the second half of 2021 – following a long period of very low inflation –, which has prompted a notable change in the economic conditions under which collective agreements are negotiated. this inflationary shock has meant that, despite negotiated wage increases having risen from 1 % 2 % in the pre - pandemic years to slightly more than 3 % in 2022 - 2023, they remain well below cumulative inflation in the last two years. moreover, marking a departure from previous decades, the degree of wage indexation in collective agreements appears to have declined significantly in the spanish economy. the percentage of workers covered by indexation clauses against inflation has risen somewhat despite the inflationary environment, to around 25 % in recent months, but is well below the coverage provided in the past. 23 furthermore, the degree of protection afforded by these clauses is also lower than before, since, on the whole, they only partially offset higher inflation. 24 in this respect, the 5th employment and collective bargaining agreement, signed in march this year, sets out general recommendations for wage increases during the period 20232025 ( the term of the agreement ). this will help recoup some of the purchasing power lost, thus contributing to sustaining employment growth while substantially mitigating the risk of second - round effects emerging via prices and wages. wage moderation may also explain, at least in part, the favourable performance of employment since the start of the inflationary episode. similarly, the gradual decline in clo se to 70 % o f wo rkers were co vered by co llective bargaining agreements in the early 2000s. mario izquierdo and jo se luis herrera ( 2023 ). inflation anticipated by the macroeconomic projections of the banco de espana and the european central bank ( ecb ) for the spanish economy and the euro area, respectively, is based on continued wage moderation going forward. indeed, these inflation projections hinge on the gradual recovery of real wages which, in a setting of likewise gradually recovering productivity, would allow for moderation of unit labour cost growth. this moderation in unit labour costs, along with the expected fall in profit margins, is essential to ensure convergence