Strike by truckers, railway workers, caregivers… Strikes have multiplied in France in recent weeks. With each time, the same request: to increase wages to face inflation.
Increases in fuel or food prices in supermarkets are felt a little more every day for households. According to INSEE forecasts, the price increase should reach 7% in September.
For Éric Heyer, economist at the French Observatory of Economic Situations, this inflation comes directly from abroad: “it is foreign prices that increase, such as gas or oil, and food products that are imported. This means that it is a drain on income which comes from abroad and which inevitably leads to loss of income in France. Now the question is, who compensates?“
Should the bosses raise wages?
Legally, no law obliges a company to increase wages in the event of high inflation.
What is the weight of the government? “SLet’s be very practical, salaries are an internal matter for the company. The government does not have the legal power or even the economic power to ask companies to raise wages,” analysis according to Bernard Vivier, director of the Higher Institute of Labor and expert in social and union issues, the executive has no means of pressure on companies.
For Éric Heyer, economist at the French Observatory of Economic Situations, it would be a mistake to attribute this role to companies only: “si companies are the only ones to respond to the problem of inflation, this will generate costs that are too high for them, which would lead to sales price increases. We would therefore not have solved the problem, it would only feed the inflationary spiral.”
Branch-by-branch negotiations
Specialists agree on this point, salary increases yes, but it all depends on the sector of the company. With on the one hand companies that have made big profits and those that have not yet recovered from the Covid-19 crisis or that are directly impacted by the rise in energy prices.
“There are companies that can, such as distribution, food or not, DIY stores for example. But there are also those who have suffered and need to restore their margins“, assures Bernard Vivier, director of the Higher Institute of Labor and expert in social and trade union issues.
For Éric Heyer, economist at the French Observatory of Economic Situations, the effort must be collective. Both from well-to-do households who saved more during the Covid-19 crisis, as well as from companies able to do so as well as from public finances: “we cannot regulate at the national level. It depends on the sector of activity, the size of the company. It is clear that in the energy sectors, the margins for maneuver are exceptional margins. This is not the case in the service sector. This drain on purchasing power must be distributed as humanely as possible.”
