Contract-based wage growth rose to 2.4% in March, far from inflation

Wages agreed in collective agreements increased by 2.4% before March, according to statistics released by the Ministry of Labor this Friday. The data grows by one-tenth compared to February and stays away from the inflation caused by energy prices. Gaining the most volatile products from the shopping cart, such as electricity and food, accelerated to 3.4% in March.

Contracts with economic effect until March 1892 amounted to 4937928 workers. It should be noted that the increase in salaries during collective bargaining between companies and staff is practically the same in the contracts signed until 2022 (2.36%) than in the contracts signed this year, which was very marked in the massive inflation, which was 2.39%.

If we look at what wage increases the manufacturing sectors and companies agree on, the latter shows a higher pay rise (2.5%), which is unusual. In general, wage growth is usually stronger during sectoral collective bargaining, but at the moment it stands at 2.35%.

One-third of the contracts (639) agreed to an increase of more than 2.5%, while 85 contracts (4.5%) provided for a pay freeze.

By sector of activity, the highest wage growth was construction (3.15%) and industry (3.1%), above average. Below, the service sector – where the vast majority of workers are employed – agreed to a 2% increase, while the agricultural sector – by 1.6%.

16% of agreements with review points

As for salary guarantee points, which renew payroll based on price evolution, they reach only 16% of the contracts. This is a key requirement of the CCOO and UGT unions in the face of an inflationary crisis to prevent workers from losing their purchasing power by ensuring that it is maintained in the medium term for the next two to three years.

Economic institutions such as the Bank of Spain argue that wage increases are “moderate” to avoid inflation loops, which poses a major risk to the economy, but unions stress that workers can not withstand the full effort of the increase. In wages, prices lose purchasing power.

The CCOO and UGT offer a state agreement that serves as a guide to increasing collective bargaining, which may be reduced due to the war in Ukraine during this difficult time, but in the medium term guarantees that workers will not be impoverished thanks to wage provisions. Review. For the time being, employers’ associations are rejecting this option, against which the Bank of Spain has taken a stand.

According to official data, contracts without guarantee points provide for a 2.2% increase in salaries by March, while those who have this size will receive a 2.8% increase.