The Bank of Spain warns that "in general" raise the minimum wage negatively affects employment

The Bank of Spain warns that "in general" raise the minimum wage negatively affects employment


The governor of the Bank of Spain, Pablo Hernandez de Cos, said today that "in general" increase the Minimum Wage Interprofessional (SMI) often has a negative effect on employment and especially affects groups with less training.

During his appearance before the Economy Committee of the Congress of Deputies, Hernández de Cos has reviewed the study of the SMI increases of 2017 and 2018, although he has avoided referring directly to the one announced by the Government for next year.

The governor has indicated that, "in general", the increase of the Minimum Interprofessional Salary has a negative effect and limited on the volume of total employment of the economy, with a special impact on the probability of losing employment in certain groups.

Specific, has referred to young people and adults with less education, which have a productivity below the average and whose unemployment rate "is still very high".

In this sense and with the objective of avoiding the loss of employment and an increase in inequality, Hernández de Cos has advocated that the SMI increases be designed "taking into account the productivity of the affected workers and their degree of employability".

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