Spain, the major European economy in which wages will grow the least in 2022


The average increase per hour worked is 2.6%, compared to the community average of 4%, according to Eurostat data at the end of the second quarter

The unstoppable escalation of inflation continues without pushing up Spaniards’ wages. Or at least not with as much intensity as the major European economies. According to Eurostat data, the average increase per hour worked in Spain between April and June 2022 is 2.6%, three tenths less than in the first quarter and well below the average of 4.1% recorded in the eurozone and 4. 4% in the European Union as a whole.

The data shows the loss of purchasing power suffered by workers who signed their collective agreements this year (or those who signed agreements in previous years, but effective in 2022). Notably, nearly eight percentage points compared to inflation which has been above double digits for three months (10.5% in August).

The gap with the main Spanish economies is striking. For example, in Germany wage costs per hour worked increased by 5.5% in the period analysed, and in Italy by 3%. In France, the figure rose by 2.7%.

In all these countries, however, wages continue to grow below inflation. The countries escaping this loss of purchasing power are led by Hungary, where labor costs are up by almost 15%, Bulgaria (+14.6%), while four other countries recorded increases above double digits: Lithuania (+12.4%) , Romania (+11.7%), Poland (+11.1%), and Estonia (+10.1%). The smallest increase occurred in Greece (+0.8%), with the Netherlands, Finland and Denmark being the only ones among Spain.

In this scenario, calls for an income pact between employers and unions have remained constant over the past few weeks. But workers’ and employers’ representatives have paralyzed negotiations since May, given the impossibility of agreeing red lines for unions, such as the inclusion of so-called review clauses to protect workers from rising inflation.

In their latest official proposal on the table, the workers’ representatives opted for a minimum wage increase of 3.5% for this year, 2.5% in 2023 and 2% in 2024, in addition to the above clauses. But this inflationary revision is completely rejected by the CEOE, as it would generate second-round effects, as other organizations such as the Bank of Spain warn.

Amid uncertainty over when and how negotiations between the parties will resume, the government has expressed support for the unions’ stance. That same week, government president Pedro Sánchez asked employers to “put their shoulders to the wheel” to promote wage increases and unblock collective bargaining.

For its part, Labor Minister Yolanda Díaz has also defended the need to raise wages, hardening her tone in recent weeks by explicitly supporting possible union mobilizations.

At the Labor and Employment ministerial meeting of the Group of 20 (G20), the vice president explained on Wednesday that in the current economic context, wages are the victim and not responsible for inflation.

“We are not facing a demand crisis and therefore we cannot respond as we have done in the past, which put two salaries under pressure. Our duty as political leaders must be that no crisis, be it health or energy or climate, turns into a social crisis,” the vice president said.

Source: La Verdad


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