Thursday, May 30, 2024

Commission Of Experts Recommends A Minimum Salary Of Between 962 Euros

The Committee of Experts that has analyzed in recent months the minimum interprofessional salary (SMI) proposes to raise the current amount of 950 euros per month (for 14 payments) to an amount between 1,011 and 1,049 euros (equivalent to 60% of the average salary) in 2023.

This is stated in the document delivered this Friday to the third vice president of the Government and Minister of Labor and Social Economy, Yolanda Díaz, in a ceremony at the Ministry. The report proposes that the Government undertake the increase in a staggered manner since 2021, with increases of between 12 and 19 euros per month this year, and concentrate most of the increase in the last two years of the period (2022 and 2023).

According to the document, the Committee of Experts recommends that the SMI rise between 2021 and 2023 between 6.4% and 10.4%, which would mean going from the current 950 euros per month to an amount of between 1,011 euros and 1,049 euros in 14 payments. This would mean raising it between 61 and 99 euros to place the SMI at 60% of the average salary.

Political decision
Minister Yolanda Díaz explained that, after receiving this report, she will meet with the President of the Government, Pedro Sánchez , “to make a decision within the coalition government ” on a possible increase in the SMI already in 2021.

Until now, the own statements of Sánchez, of the second vice president, Nadia Calviño, and of the Minister of Finance and Spokesperson, María Jesús Montero , have put the accent on giving priority to economic and job creation, thus pointing in the direction of no undertake no increase in the SMI in 2021.

“When the outbreak of the pandemic I said that health should not be contrasted with the economy and now I say that we stop opposing job creation and a rise in the SMI”, Yolanda Díaz said after receiving the report from the experts.

The Labor Minister recalled that the CPI has risen to 2.7%, the increase in the price of electricity and products, in general. In addition, he pointed out that on average wages are rising in collective agreements by an average of 1.8%.

This context, according to Díaz “leaves out the weakest people”, which are the around 1.5 million workers (10% of the employed population) whose remuneration is guided by the SMI, “who have the face of the precariousness of young people and women “, he added, to defend the convenience of an improvement in the minimum wage already in 2021 .

“The need to give that positive message at a time when the crisis is coming out is what has led us to recommend this gradual rise in 2021”, pointed out the president of the Committee of Experts, Inmaculada Cebrián López, professor at the Department of Economics from the University of Alcalá de Henares.

According to Cebrián, the group of experts saw this thesis reinforced after knowing the report of the Bank of Spain with an estimate of the impact on employment of the last increase in the SMI in 2019 to 900 euros. The Bank of Spain has estimated that this increase in the SMI slowed the creation of 154,000 jobs but allowed progress in social equity.

Three assumptions
Cebrián explained that the Commission has estimated three different minimum wage scenarios for 2023, based on different starting assumptions, once the data of what the average net salary was for a full-time worker in 2020 is known.

To begin with, the report has made three assumptions: that the average salary rose 0% in 2020; that it increased 0.9% or that it increased 1.8%. Based on each of these three assumptions, it is projected that the magnitude of 60% of the average net salary could evolve towards 1,011 euros, 1,027 euros or 1,049 euros in 2023. And for each of the three assumptions, a stepped path is proposed , throughout the years 2021, 2022 and 2023 to reach the goal.

Based on an average salary increase of 1.8% in 2020 and a projection of SMI of 1,049 euros in 2023, the Commission proposes this path to accommodate the increase of 99 euros compared to the current 950: increase of 19 euros to the month in 2021; 40 euros in 2022 and another 40 euros of increase in 2023.

If we start from a 0.9% rise in 2020 and a SMI projection of 1,027 euros in 2023, this path of increases is proposed to accommodate the rise of 77 euros: 15 euros in 2021; 31 in 2022 and another 31 euros in 2023.

For the third case, that of a null variation of the average salary in 2020 and a projection of SMI of 1,011 euros in 2023, the path to fit the increase of 61 euros is this: 12 euros in 2021; 24 euros in 2022 and 25 euros in 2023.

Expert Commission
The Commission of experts, which was established at the end of January, has carried out a technical analysis to establish the route that the SMI should follow until reaching, at the end of the legislature, 60% of the average salary in Spain, a goal to which it has committed the Government and which is also the one that establishes the European Social Charter.

Seven academics, three members of the Government and two union representatives are part of the SMI expert commission, since the representatives of CEOE and Cepyme decided to leave this commission days after its constitution, considering that it “distorted” the social dialogue.

On the part of academic professionals, members of this Commission are the president of the CES and professor of Economic Policy at the University of Barcelona Antón Costas; Professor of Economics at the University of Alcalá de Henares (UAH) Olga Cantó; the former associate professor of the Carlos III University of Madrid José Ignacio Pérez Infante; the professor of Applied Economics at the University of Salamanca Rafael Muñoz de Bustillo; the professor of Economics of the UAH Inmaculada Cebrián López; Sara de la Rica, Professor of Economics at the University of the Basque Country, and Gemma Galdón Clavell, member of the Department of Sociology at the University of Barcelona.

On the part of the unions, this group of experts includes María Jesús Cedrún (UGT) and Carlos Martín (CCOO), while on behalf of the Government are Manuel Lago (Ministry of Labor and Social Economy), César Veloso (Ministry of Finance) and Carlos Corps Caballero (Ministry of Economic Affairs and for Digital Transformation).

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