Salaries rise 2.4% in collective agreements until April, much less than prices

The salary increase agreed in the collective agreements remained at 2.4% in April, only a few tenths more than the one registered in March (2.36%). The smallest advance in recent months is assumed in a context of high inflation, 8.4% year-on-year in April, which leaves wages a long way from the rise in prices. The scenario is also one of uncertainty due to the war in Ukraine and confrontation between employers and unions in the wage debate, which made talks broke down for a state agreement some days ago.

Unions and employers break without agreement the negotiation of the salary increase for 2022

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In the absence of statistics on the progress of the set of wages of male and female workers at this time, which will still take a long time to be published, the Ministry of Labor publishes the data on collective agreements every month, which allows us to observe at least what are the wage increases agreed in sectoral and company collective agreements.

Until April, the wage increase was 2.4% on average, collected in 2,037 agreements that affect just over half a million companies and 5.4 million workers. The average increase is broken down into a rise of 2.6% in company agreements and 2.4% in higher level agreements.

By sector, construction is the one that has agreed to the highest wage increases, 3.15% on average, followed by industry, 3.1%, both above the average. Below, is the services sector, with an increase of 2.1% and, finally, agriculture, 1.8%.

Hikes without a state-level agreement

These salary increases are being agreed in isolation without a reference at the state level between employers and unions in the AENC (state collective bargaining agreement), which expired in 2020 and usually serves as a framework for companies and sectors throughout the country. Last Thursday, CCOO, UGT, CEOE and Cepyme broke off the talks on the salary increase for this year, after several meetings with very opposed positions.

After numerous agreements in the last two years, the social partners have not been able to agree on wages. More than the increase figure for this year, the focus of the conflict between employers and unions lies in the claim of the latter for a clause to review wages according to prices. A measure that today only includes 16% of collective agreements.

CCOO and UGT admit that more moderate salary increases can now be agreed with respect to prices (which increase by 8.4% year-on-year), but they demand that at the end of this year and in the short term -two or three years-, update the agreed increase to the evolution of prices so that workers do not lose purchasing power.

After the breakdown of the negotiation, this Tuesday the Executive Committee of the CEOE employers' association meets to agree on the recommendation of a salary increase to the companies of the country. This will be above 3%, according to sources consulted by this means. At the moment, only one in five companies has agreed to an increase in their salaries above 3% for this year, according to statistics on collective agreements.

Prices grow strongly, beyond energy

With these salary increases in the agreements, the workers are losing a lot of purchasing power. Inflation stood at 8.4% in April, more moderate compared to March –when it was close to 10%– given the lower price of energy. Even so, it is still very high and also shows worrying signs.

The high inflation is no longer explained only by skyrocketing energy prices, but rather the boom has spread to many other prices. This can be seen in the core CPI data, which excludes energy prices and unprocessed food prices (fruits, vegetables...), which are more volatile. This shot up to 4.4% in April, a record since 1995.

Meanwhile, inflation suffocates millions of workers with low wages or with low labor intensity at home, as Estefanía, Antonio and Isabel recounted in this report. “You realize that –luckily– you are not unemployed and that it is not that you are whistling, but that you are working eight and ten hours a day, the statutory ones and also taking odd jobs on the side. And even then you don't arrive”, denounced Isabel, a home help worker.

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