MADRID - Improving economic conditions should allow Spain to approve a long-awaited minimum wage hike in September, the economy minister said on Monday, bringing an end to months of back and forth between unions and businesses.

The "limited" increase would come into force as early as October, Economy Minister Nadia Calvino said in an interview with Spanish broadcaster TVE.

She declined to estimate the scale of the likely increase.

Her left-wing coalition last increased the minimum wage by 5.5% in 2020, shortly before the pandemic struck, bringing it up to 1,108 euros ($1,314.09) a month.

Positive developments in the Spanish labour market, with unemployment approaching pre-pandemic levels, now allow for a further increase, Calvino said.

The number of people registering as unemployed fell 2.4% in August to 3.33 million, the lowest level since February 2020, a month before a nationwide lockdown was imposed, sending the economy spiralling.

At that time, 3.25 million people were unemployed.

The minimum wage in Spain is set through negotiations between labour unions and business representatives, although the government can force through a settlement if no consensus is reached.

Prime Minister Pedro Sanchez last week said the government wanted an "immediate" minimum wage increase.

($1 = 0.8432 euros)

(Reporting by Emma Pinedo and Inti Landauro; editing by Nathan Allen and Jason Neely) ((emma.pinedo@thomsonreuters.com; +918 35 68 34;))