The growth minimum wage (smic) will automatically increase by 2.65% on 1it is May due to the high inflation registered since November, the Ministry of Labor announced on Friday, April 15. But neither Emmanuel Macron nor Marine Le Pen want to go beyond this automatic increase.
For a full-time job, the minimum monthly salary will be 1,645.58 euros gross. Net, it will drop from 1,269 euros to 1,302.64 euros. The minimum gross hourly wage will drop from 10.57 euros to 10.85 euros. This increase will directly benefit more than two million employees.
Exceptional rise of 2.2% in October
In January, the minimum wage had risen 0.9% after an exceptional increase of 2.2% in October, due to inflation. In 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 rises at least as fast as the inflation affecting the most modest households.
According to the final results of the consumer price index for March published this Friday by the National Institute of Statistics and Economic Studies (Insee), inflation without tobacco between November 2021 and March 2022 stands at 2.65% for the 20% of households with the lowest income. Therefore, the minimum wage will increase in the same proportions.
This mechanism is all the more protective since, as Julien Pouget, head of INSEE’s business cycle department, pointed out in mid-March, the price index for low-income households is rising faster than the general index. “taking into account the weight 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 – that provides for a repeat in the course of ‘year’insists the economist Gilbert This, president of the group of experts on the minimum wage that must be consulted by the government before each increase.
The evolution of inflation remains unpredictable
According to Cette, the evolution of inflation in the coming months remains unpredictable due to the war in Ukraine, although it should be affected by the entry into force of the government cut from 15 to 18 cents per liter of fuel.
“Then there is the unknown of the transmission of the increase in the prices of raw materials to production prices, then to sales prices and wages”he explains.
While various unions -but not the CFDT- are demanding a much higher increase in the minimum wage -10% for the UNSA, for example-, the two finalists in the presidential election oppose a ” stimulus “which has not happened 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, exempting from contributions those that increase their employees by 10% earning the equivalent of less than three minimum wages. For his part, Emmanuel Macron wants to triple the bonus ceiling without social charges or taxes that companies can pay their employees.
Another consequence of this increase in the minimum wage, many branches will find themselves with minimum wages – defined by their collective agreements – once again exceeded by the minimum wage.
Of the 171 branches that serve more than 5,000 employees, 67 presented at the end of March, even before this revaluation, a grid with at least one coefficient lower than the minimum wage, according to the Ministry of Labor.
The CFDT requires that these branches trapped by the rise in the minimum wage be forced to open negotiations within a period of three months in order to continue benefiting from the exemptions from social security contributions for wages below 1.6 minimum wages.
The CGT proposes that each increase in the minimum wage give rise to an automatic revaluation of the minimum wages in the industry, in order to avoid a “devastating” low-end salaries.