The minimum growth wage (smic) will automatically increase by 2.65% on 1er May due to the high inflation recorded since November, announced Friday, April 15, the Ministry of Labor. But neither Emmanuel Macron nor Marine Le Pen want to go beyond this automatic increase.
For a full-time job, the monthly minimum wage will be 1,645.58 euros gross. Net, it will drop from 1,269 euros to 1,302.64 euros. The gross hourly minimum wage will drop from 10.57 euros to 10.85 euros. This increase will directly benefit just over two million employees.
Exceptional increase of 2.2% in October
In January, the minimum wage had increased by 0.9% after an exceptional increase of 2.2% in October, already due to inflation. Over one year (from May 2021 to May 2022), the minimum wage will have increased by 5.9%, or 72 euros net.
In France, the purchasing power of minimum wage workers is protected by an automatic revaluation mechanism enshrined in law, which ensures that the minimum wage increases at least as fast as inflation affecting the most modest households.
According to the final results of the consumer price index in March published by the National Institute of Statistics and Economic Studies (Insee) on Friday, inflation excluding tobacco between November 2021 and March 2022 stands at 2 .65% for the 20% of households with the lowest incomes. The minimum wage will therefore be increased in the same proportions.
This mechanism is all the more protective since, as Julien Pouget, the head of the business cycle department of INSEE, pointed out in mid-March, the price index for low-income households is increasing faster than the overall index. “taking into account the weighting of energy and food in its composition”.
“Of the 30 OECD countries with a minimum wage, only three provide for an automatic adjustment linked to inflation and only one – France – which provides for it to be repeated in the course of ‘year “insists the economist Gilbert This, president of the expert group on the minimum wage which must be consulted by the government before each increase.
The evolution of inflation remains unpredictable
According to Mr. Cette, the evolution of inflation in the coming months remains unpredictable because of the war in Ukraine, even if it should be affected by the entry into force of the government rebate of 15 to 18 centimes per liter of fuel.
“Then there is the unknown of the transmission of the rise in commodity prices to production prices, then to selling prices and wages”he explains.
While several unions – but not the CFDT – are demanding a much higher rise in the minimum wage – 10% for the UNSA for example – the two finalists in the presidential election are opposed to a “boost”which has not occurred since the election of François Hollande in 2012, and would penalize, according to them, the employment of the least qualified.
Marine Le Pen wants to encourage companies to increase wages, by exempting from contributions those who increase their employees by 10% earning the equivalent of less than three minimum wage. For his part, Emmanuel Macron wants to triple the ceiling of the bonus without social charges or tax that companies can pay to their employees.
Another consequence of this rise in the minimum wage, many branches will find themselves with minimum wages – defined by their collective agreements – again exceeded by the minimum wage.
Of the 171 branches covering more than 5,000 employees, 67 displayed at the end of March, even before this revaluation, a grid comprising at least one coefficient lower than the minimum wage, according to the Ministry of Labor.
The CFDT demands that these branches caught up by the rise in the minimum wage be forced to open negotiations within three months in order to be able to continue to benefit from exemptions from social security contributions for salaries below 1.6 minimum wage.
The CGT proposes that each increase in the minimum wage gives rise to an automatic revaluation of the minima in the branch, in order to avoid a “crushing” bottom-of-the-range salaries.