Spain's unemployment rate has doubled over the past two years to hit 19.3% in October.
Prime Minister Jose Luis Rodriguez Zapatero promised during the last general election campaign in 2008 to raise the minimum wage to 800 euros by 2012 if his Socialist Party was re-elected for a second term.
Spain, along with Portugal, Greece and the new members of the European Union in central and eastern Europe has one of the lowest minimum wages in the 27-nation bloc.
In December of last year the government increased the minimum wage for 2009 by 4.0 percent from 600 euros to 624 euros a month.
The government said consumer prices rose this year at a far lower rate than in previous years and a policy of wage moderation in 2010 to contribute to the economic recovery and create jobs seemed appropriate.