Jérôme Gautié is professor of economics at the University of Paris-I-Panthéon-Sorbonne. It reviews the historical origins of the minimum wage and its social and symbolic importance.
In what context was the minimum wage created in 1950?
Prices and wages had been controlled by the state since 1939. When it was decided to return to free pricing, the unions argued that wages could not remain blocked, at the risk of a loss of purchasing power. The law of 1950 restores the freedom of collective bargaining, and at the same time creates the first guaranteed interprofessional minimum wage (smig). It is thought of as a safeguard to avoid any exploitation where unions are weak or non-existent. It is then necessary to fix its level. There is a great fear of the government, already at the time, that we will cause inflation or that we will destabilize the economy if it is too high. But should it be a simple minimum wage or a living wage? And what is decency? Employers and unions agree on the food budget, not on the rest, with fierce discussions on the number of soaps, costumes or nightgowns needed, or electricity costs! Ultimately, it was the government that decided.
Why did the minimum wage become the minimum wage in 1970?
During the strikes of 1968, one of the first union demands was the revaluation of the minimum wage. The latter fell sharply in relation to the average wage: over the period between 1951 and 1967, its purchasing power only increased by 25% against 103% for the second, driven by growth and productivity gains. The Grenelle protocol records a 35% increase in the minimum wage. The employers, frightened, accepted almost without discussion, whereas they had refused 3% a few months earlier! To avoid any new dropouts, the calculation method was changed from 1970, with the transition to the minimum wage: the minimum interprofessional growth wage will be partially indexed to the average hourly wage of a worker.
With inflation, the minimum wage catches up with low wages, some advocate its de-indexation, others advocate, on the contrary, to index all wages. Has this question ever been asked?
From the outset, the link between the minimum wage and the minima of collective agreements has been at the heart of the debates. The great fear of the government when it adopts the minimum wage is that all salaries will increase in the same proportion. This is what the CGT has always advocated. But the law of 1970 prohibits it. It’s a bit of a paradox today: faced with successive increases in the minimum wage, the government is pushing the branches to negotiate so as not to be caught up. What is certain is that today the minimum wage has become a fundamental pillar of the French social model. It is a social contract, a “wage of civilization”, some said when it was created. To make sure that the one who works does not pick up. Going back on this is symbolically impossible and would be very costly politically.