SMEs see a new increase in the minimum wage in 2024 as unaffordable

The unions warn that a new increase in the interprofessional minimum wage (SMI) will be essential in January in order to maintain equivalence with 60% of the average wage.

Oliver Thansan
Oliver Thansan
03 September 2023 Sunday 10:27
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SMEs see a new increase in the minimum wage in 2024 as unaffordable

The unions warn that a new increase in the interprofessional minimum wage (SMI) will be essential in January in order to maintain equivalence with 60% of the average wage. This percentage was one of the objectives of the government coalition of the PSOE and Podemos, and it met it by reaching 1,080 euros per month this year. It represented an increase of 47% of the SMI in five years, going from 736 euros in 2018 to the current 1,080 euros.

For CC.OO., in January this salary must be increased. "Stagnation is not acceptable," says Carlos Gutiérrez, confederal secretary for Trade Union Studies and Training, who adds that the increase is required given the inflation that is being recorded, especially in areas such as food, where it is skyrocketing, and especially affects workers with lower wages. It is a first union warning, although at the moment without advancing figures. It will be towards the end of the year when the average salary can be calculated, and from there start the negotiation.

In any case, employers, and especially small and medium-sized companies, have already criticized this equivalence. "An excessive emphasis has been placed on the minimum wage reaching the equivalent of the national average wage, when this is not fulfilled in any European country," says the Cepyme document Cepyme Proposals for the new Government.

There is no government and it is not expected immediately, but unions and employers are preparing the ground for a negotiation of the SMI. In 2020, the CEOE agreed with the increase, but it was the exception, and in recent years it has opposed it.

The truth is that the power to establish the SMI corresponds to the Government, which is only obliged to a prior consultation with the social agents. From there, it decides "taking into account the CPI, the national average productivity achieved, the increase in labor participation in national income and the general economic situation," according to the Workers' Statute.

In any case, Cepyme criticizes the 60% objective because the average salary is very different depending on the Spanish provinces, sectors and the size of the companies. He considers that this objective does not take into account the Spanish reality, which is why the SMI "far exceeds this proportion in many provinces, especially the most depopulated ones." His conclusion is that "this labor cost has become unaffordable for many SMEs, especially in the service sector."

One of the elements that this employer points out is that the increases in the SMI have a much greater impact on SMEs, as shown by the fact that the average salary has increased almost twice among small companies than in large ones since 2018. Specifically, an increase of 10.4% in SMEs compared to 5.7% in larger ones. Analyzing by sector, they highlight that in six areas the SMI currently exceeds 60% of the average salary, with the most prominent case being the hospitality industry, where it practically equals it. In addition, by territorial distribution, it appears that in 13 autonomous communities the current SMI of 1,080 euros already exceeds 60% of the average salary.

They are the employer's arguments. Instead, the unions demand the equivalence of the SMI with 60% of the average salary in 2024. "A salary has to be that income of a worker that allows him and his family to live, not just survive," says Carlos Gutiérrez, of CC.OO. He also argues the impact of inflation among families, therefore, also those who benefit most from any increase in the minimum wage, and adds that the experiences of recent years of rising SMI have been positive "not only at a social level, for the worker, but also for the country's economy as a whole.