Business The rise in the minimum wage has already destroyed...

The rise in the minimum wage has already destroyed 45,000 jobs


The rise of Minimum Interprofessional Salary (SMI) Last year, the labor market has already been invoiced, as the Bank of Spain warned and recently confirmed by the Secretary of State for Social Security. According to a report by BBVA Research (the bank's analysis department), the recovery of the Spanish economy will depend on the policies that will be implemented in the coming months, as it believes that there is high uncertainty due to the lack of consensus on issues key and for the possibility of some reforms of the past being reversed. Therefore, he called on the new Government to evaluate the effects that have had reforms such as labor or pension before repealing them, in order to maintain those aspects that have been positive, and to analyze the costs and benefits of the changes promoted in the housing sector or of the increase in the minimum wage before making new decisions in this regard.

In this sense, the entity calculates that with The increase of 22% of the SMI in 2019 (up to 900 euros per month in 14 payments) has left create about 45,000 jobs in net terms throughout the year, measured in Social Security affiliates, which in the report is considered a limited impact. The head of Economic Analysis of the entity, Rafael DoménechHe explained that this figure has an impact on job creation of up to 4 tenths, which reaches 7 tenths only for the general Social Security regime, suggesting that the rise of the SMI could have driven a transfer of contributors from salaried employment to self-employment.

Despite these alarming data, the new Minister of Labor, Yolanda Díaz, has advanced that the first meetings with the employers and unions to analyze the rise in the minimum wage will be this week, while it has influenced that the new Statute of Workers will study the current severance pay. In an interview in La Sexta, the Minister of Podemos has stressed that "this week, these days" will advance in informal meetings with social agents, with which it will be seen at the same time, in order to treat the rise of the SMI progressively until reaching 60% of the average salary at the end of the legislature. "It will be the first thing we do," Diaz said.

The Bank of Spain believes that labor reform has saved jobs

The intentions of the Government clash with the reality exposed by the main agencies, such as the Bank of Spain, who just remembered that the labor reform saved jobs. The governor, Pablo Hernandez de Cos, asked the Government last night for an agenda of structural reforms and defended that the 2013 labor reform was an “effective lever” to create employment. Hernández de Cos pointed out that it is necessary to reduce indebtedness vis-à-vis the outside for what it is necessary to maintain the competitiveness gains that throughout the recovery have been based on the moderation of labor and financial costs and that in future should rest, in greater measure, in productivity increases. Productivity improvements remain scarce, in his opinion, due to institutional, regulatory and structural factors "that public policies should aim to correct." In this regard, he recalled that competitiveness gains of the last ten years they explained, at first, for the strong destruction of employment, and then for the wage moderation derived from the labor reform, which was "an effective lever" to boost employment recovery.

The national president of the Associations of Autonomous Workers (ATA), Lorenzo Amor, has assured this Wednesday that raising the Interprofessional Minimum Wage would be "a slap" for the emptied Spain, since the productions cannot bear the labor costs. After presenting the balance of last year's situation of the self-employed in Castilla y León, Amor has commented that, “in a small town, a freelancer who runs a cafeteria, for example, has not raised its products by 22%, which has increased the salary in the last year ”. Therefore, it has been considered that, if the SMI continues to increase, the consequences are that “either the worker who has been hired is discarded, or the business is closed”, although it can also “Increase the submerged economy”, as has happened in 2019, in which “60,000 people” in Spain have moved into this situation. Precisely, in rural areas where agricultural activity predominates is where the rise in the minimum wage has had a greater negative impact. The Secretary of State for Social Security, Octavio Granado, recognized last month "problems" in some sectors such as domestic employment or agriculture, where the real salary increase is between 11% and 15%, far from 22.3% established by decree almost a year ago.

The secretary general of Working Commissions (CC OO), Unai Sordo, has assured that he will attend this week the meeting of the Government with unions and employers to negotiate the minimum interprofessional salary for this year with a proposal of 1,000 euros, although it will manifest its willingness to negotiate. In an interview with Efe, the leader of CC OO says that he wants the SMI to reach 60% of the average salary, as the European Social Charter says, a figure that has generated some controversy and that, according to the union's calculations, it would amount to 1,003 euros this year, which would represent an increase of 11%. "If we are faced with an itinerary from the current 900 euros to that 60% throughout the Legislature, we are in charge of negotiating it," says Sordo, convinced that the employer will refuse 1,000 euros and says he does not know which It is the proposal that the Government will take. For Sordo it is urgent to approve “before the end of January” an update of the SMI, because “it has effects on the payrolls that are going to be collected already this month”, and rejects the opposition posed by the employer, in which he sees “a certain contradiction".

. (tagsToTranslate) Minimum Salary (t) Work (t) Bank of Spain


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