• Forecasts: The Bank of Spain warns: the Government will barely reduce the deficit and unemployment stagnates
  • Laboral.Sánchez offers to raise the SMI to 1,000 euros when president is invested

The communities in which the highest interprofessional minimum wage (SMI) has had the highest incidence are already experiencing a worse evolution in the labor market . And for this reason, carrying out new increases such as those planned by Pedro Sánchez and his partners of Unidos Podemos for 2020 requires an in-depth evaluation that anticipates what the consequences of this decision will be.

The warning was made yesterday by the general director of Economy and Statistics of the Bank of Spain, Óscar Arce, and involves the verification of some of the potential risks of the SMI: that in those regions where salaries are more moderate - as well as in the poorly paid sectors - the increase in the minimum wage becomes an obstacle to hiring . The best examples of this situation are, according to Funcas, Canarias, Extremadura and the Region of Murcia, communities in which the coverage rate, that is, the number of workers who have a salary equal to or less than the SMI is very high. And that means that a part of the population can be in a situation of risk of exclusion from the labor market.

That is precisely why Arce warned that it is "fundamental" for the Government to evaluate, analyze, before acting. Do not promise such a measure as raising the SMI to 1,000 euros without knowing what the consequences are. "We do not have from this institution any negative vision, much less, against the existence of an SMI," said the head of the Bank of Spain in statements collected by Europa Press, but from the agency they are "firm advocates" of the need analyze these types of measures, "especially when they are done in such a high magnitude".

Arce, who clarified that in the worst behavior that the labor market of these autonomies registers could also be favored "by other factors", he made these warnings during the presentation of the update of the projections of the Bank of Spain. In this document, the Bank maintained the growth estimates that it already lowered in September, but substantially worsened unemployment and deficit forecasts .

In the first case, it foresees that the reduction in the unemployment rate will stagnate and that in 2021 it has not yet dropped by 13%. The figures contrast with the official forecasts of the Government, and reflect "both the slower pace of job creation and a modest rebound in the pace of progress of the active population ." This means that there is a part of that smaller reduction that is due, as the Sanchez Executive maintains, that there has been an increase in the population that is looking for work but also, and that the Executive omits it, because the creation rate is reduced.

And regarding the budgetary deviation, the regulator rules out that the Executive will meet any of the deficit objectives. Neither the officer nor the renegotiated nor the finally self-imposed. Specifically, for this year it estimates that the deficit will be 2.5%, one tenth more than previously expected, while in 2020 the data will be 2.1% and in 2021 it will amount to 1.8%. In the last two cases, the figure is three tenths higher than previously estimated, so the new document estimates a total revision of seven tenths that is largely due to the increase in pensions .

"An increase in pensions is assumed in line with the CPI for the period 2020-2022, compared to the revaluation of 0.25% assumed in the September projections exercise," explains the BdE, which thus figures the cost from another of Sánchez's big commitments: up to an additional 8,000 million deviation between 2019 and 2021 .

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