New SMI for 2024
In the last five years, the Interprofessional Minimum Wage The unemployment rate has seen a significant increase of 46.51%, and signs indicate that next year could see another increase. The government has already begun talks with employers and unions to address this potential rise, focusing on the continued reduction of inequality in the country.
Projections point to a 4% increase in the Interprofessional Minimum Wage for the year 2024, according to the proposal presented by the Ministry of Labor.
It is crucial to note that the implementation of this change would not be instantaneous, as requires the approval of the General State Budget for the year 2024This process underscores the importance of closely monitoring the ongoing negotiations, as their outcome will have significant repercussions on wage dynamics and economic equity in the country.
Negotiations for the 2024 SMI
In recent weeks, union representatives, employers, and the government have been meeting to discuss a possible increase in the minimum interprofessional wage (SMI) next year. According to the European Charter, the objective is for the SMI to reach 60% of the average salary in Spain.
However, a complication arises: various official sources calculate the average wage, leading to discrepancies. Until now, the official reference for calculating the minimum wage was the National Statistics Institute's salary survey, along with Social Security data.
Recently, UGT has proposed using data from the Tax Agency, which would yield higher figures, implying a possible increase of up to 150 euros in the minimum wage.
Both the TGSS and the INE agree that the average salary in Spain is around 25,000 euros, which, applying the 60%, would place the minimum wage at around 1,260 euros per month in 12 payments (current minimum wage).
However, according to the Tax Agency, the estimates are higher, placing the average salary at €28,301 per year. In this scenario, the 60% of that figure would require a minimum wage of €1,400, which would imply an increase of €150 in 2024.
Furthermore, the CCOO (Working Workers' Commissions) expresses its intention to request an increase in the minimum wage (SMI) for 2024, motivated by the significant rise in food prices. This need for an increase that exceeds the general inflation rate responds to the union's intention to adjust the minimum wage to market conditions, guaranteeing a decent standard of living for all workers.
Outlook for the SMI in 2024
Recently, the Ministry of Labor has hinted at the possibility of an increase in the Interprofessional Minimum Wage (SMI) that could reach 4% for next yearIf this increase materializes, the minimum wage would rise from the current €1,080 per month for fourteen payments to €1,123.2 per month.
However, the government emphasizes that any adjustment should be in line with the average CPI rate between December 2022 and November 2023.
On the other hand, the CEOE presented a concrete proposal a few weeks ago: to increase the salary by 3% in 2024 and repeat the increase in 2025, resulting in a total increase of 6% over the next two years:
- 2024: Raising the minimum wage to 1,112.4 euros in 14 installments.
- 2025: Increased to 1,145.77 euros in 14 installments.
This would imply a increase of 65.77 euros in the SMI during the period, that is, 32.4 euros for 2024 and 33.37 euros for 2025.
However, the CCOO and UGT unions consider this CEOE proposal insufficient, advocating for an increase that would reach 60% of the average salary. They also suggest the possibility of legally establishing the minimum wage as always at least 60% of the minimum wage, proposing an automatic system similar to that for pensions.
The final outcome of these discussions between the government, employers, and unions remains to be seen, although we'll be able to provide more news on this matter early next year.
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