Economic News The Government finalizes another blow to labor costs with the SMI frozen while waiting to convince the unions

The Government has already put in black and white the figures of the new increase in labor costs that companies and workers will bear from January 1. All, except one: the interprofessional minimum wage (SMI). This reference to which the lowest contribution bases are linked will start the new year frozen, waiting for the Government to decide whether to continue trying for a tripartite agreement that is impossible in social dialogue or approve the measure by decree unilaterally or with the only support from the unions.

The Ministry of Social Security has ready the order by which the legal contribution standards for next year are developed. The document, in the process of public hearing, includes an increase in the maximum bases of 5%, from the current 4,495.5 euros to 4,720.5 euros. This increase is equivalent to a 3.8% increase linked to inflation and an additional 1.2 points for the surcharge imposed on workers who earn higher salaries to finance the rebound in pension spending until 2050.

The economic report prepared by the department headed by Elma Saiz, consulted by EL MUNDO, also quantifies that Social Security expects to collect an additional 590 million euros due to this increase in the maximum contribution bases. And it reveals another especially striking fact: the collection from the Intergenerational Equity Mechanism (MEI), which all workers pay to cover the retirement of the baby boom and which next year rises from 0.6% to 0.7%, will increase. It will increase by no less than 35% in 2024, to exceed 3,690 million euros.

In total, the Executive projects an increase in collection from social contributions in 2024 of 7.8% compared to this year, which implies that it will be close to 167,000 million thanks, largely, to the rise in labor costs. And this without taking into account the impact of the increase in the interprofessional minimum wage (SMI) on the minimum contribution bases. The regulatory text assumes that “the validity of Royal Decree 99/2023, of February 14, which established the minimum interprofessional salary for 2023, will be extended until the royal decree setting the salary is approved.” interprofessional minimum for the year 2024″.

So the SMI will start the year frozen, according to the Government itself. Sources from the Ministry of Labor, responsible for bringing the measure to the Council of Ministers, advance that, “predictably”, it will not go to the last conclave of the year, which is being held this Wednesday in Moncloa. “We must continue working,” they add, and confirm that Yolanda Díaz will once again convene the social agents to try to reach an agreement. Although the increase in the minimum wage is the exclusive power of the Executive, consultation with social agents is mandatory and the intention of the second vice president has always been to reach a consensus with the employers and the unions.

However, Díaz’s efforts have not prospered on the business side in recent years and everything indicates that this will be no different. The CEOE remains in the ‘no’ and will hardly move from that position because the Government – specifically, the Ministry of Finance – rejects its demand to apply the increase in the SMI to the prices of public contracts so that companies that provide their services to administrations can bear the higher labor costs. “For us, indexing is a sine qua non,” employers’ sources insist. “The Government is suffocating the self-employed and SMEs that work with the administrations,” accuses a senior official on the Board of Directors of the business organization.

The ball is, therefore, in the union court. The Ministry of Labor has proposed a 4% increase, up to 1,123 euros in 14 payments. But CCOO and UGT require at least 5%. In any case, the interlocutors on this side of the negotiating table still see room for an agreement, according to several sources involved in the talks. It would not be the first time that Yolanda Díaz modifies her approach to adapt it to union demands once the businessmen withdraw from the game. “There is a party,” they say from one of the unions.

The new salary reference could be approved well into the year and applied retroactively to January 1, as has happened on previous occasions. That is why the Government is in no hurry and the head of Labor prefers to give herself room to try to reach an agreement, even if only with the unions, at a delicate moment for social dialogue. Both business and union organizations have accused the Government of ignoring agreements and approving far-reaching measures through the back door.

They refer, for example, to the prevalence of the autonomous agreement that Pedro Sánchez granted to the PNV in exchange for its support for the investiture, a measure that was left out of the agreed labor reform. Or the cut in the contributions of recipients of the subsidy for those over 52 years of age, which will reduce the amounts of their retirement pensions. Both measures were incorporated in the decree that approved the reform of the unemployment assistance system, which Yolanda Díaz took to the Council of Ministers without agreeing on it with the social agents due to the urgent need to unblock a new disbursement of 10,000 million euros from the European funds.