Tuesday, during his general policy statement before the National Assembly, Prime Minister Michel Barnier announced that his government would “revalue the minimum wage by 2% from November 1, in anticipation of the date of January 1.” Currently at 1,398.70 euros net, how much will it rise after its increase?
With the increase in the minimum wage announced “in anticipation”, the monthly net minimum wage would thus be increased to around 1,426 euros net, or around 27.30 euros more per month. This is the first time that it has gone above the 1,400 euros monthly mark.
The minimum wage, the only salary indexed to inflation
As a reminder, the minimum wage benefits each year from a mechanical increase on January 1 as well as increases during the year as soon as inflation exceeds 2%. It is also the only salary indexed to inflation.
The government can choose to go beyond the automatic increase with a “nudge”, but there has not been one since 2012. In this case, the Prime Minister announced an “anticipation”.
This anticipation includes “November and December, so, in principle, there will be no significant revaluation in January unless there is a boost beyond what the legal rules prescribe,” economist Stéphane explained to AFP. Carcillo, president of the group of experts on the minimum wage.
The minimum wage has increased eight times since January 2021
The minimum wage has increased eight times since January 2021, including four times during the year due to inflation. The last revaluation was on January 1st. The unions, who met the Prime Minister last week, include wage increases among their demands. The CGT, FSU and Solidaires demonstrated on Tuesday for the government to “respond to social demands”, particularly on these salary issues.
The number of employees paid the minimum wage has increased significantly in France. As of January 1, 2023, 17.3% of employees were affected. As the minimum wage increases faster than the rest of wages, certain sector minimums are caught up. The branches are thus regularly called to order by the government.
Exemptions, maximum at the minimum wage level, introduced to support employment, are today accused by certain economists of slowing down wage progression by creating “low wage traps”. This is why Michel Barnier intends to review the contribution reduction system.