• Labor Bank of Spain warns of the drastic rise of the SMI
  • Employment: The increase in SMI and social contributions cause the highest rise in labor costs

About a year after the 22% increase in Minimum Interprofessional Salary (SMI) applied unilaterally by the Government, the Ministry of Labor has described this decision as "a success", while admitting that it has impacted vulnerable groups such as domestic workers and farm workers .

The first of these groups, according to the Secretary of State for Social Security, Octavio Granado , has fitted the measure by going to the black market in a magnitude of 13,000 people . The second, failing to charge overtime as compensation for the increase in their basic salary.

That this type of workers were going to be precisely the pagans of one of the first labor measures approved by Pedro Sánchez after his pact with Podemos was warned by institutions such as the Bank of Spain. Such a sudden rise would end up destroying employment, precisely among those to whom it announces a benefit. The Government faced the supervisor for this reason in a hard controversy.

Now, Labor maintains the focus on the benefits of its measure, which indicates that it will be analyzed in posterity as a great economic policy decision, but admits collateral damage . "The problems are seen in groups such as domestic workers, who have little social recognition. It is possible that someone prefers to be a deliveryman for Glovo or Deliveroo. Where are the 13,000 employees who have left? Well, they have probably gone into the submerged economy We know that there are the same number of domestic workers but we cannot enter the homes to control it. We have to live with that reality, "said the senior Social Security office.

Agricultural impact

With regard to the other pagan of the rise of the SMI, the agricultural sector, Granado has explained that his agency has detected a lower number of declared hours . "We can think that there is temptation to obscure the impact of the SMI with fewer hours declared. Workers have only earned 12% in the improvement of salaries," he admitted. Unions such as UGT have been warning for months that the new SMI has great difficulty integrating into the agreements of farm workers.

In this situation, Labor has been cautious when it comes to advancing if in the coming weeks it will repeat the action of December last year to raise the SMI before the end of the year The Secretary of State for Employment, Yolanda Valdeolivas, has preferred not to commit by indicating that the Government has opened consultations with the State Advocacy to know if it can take this measure while in office, although it is a decision that does not compromise the Budgets of a new Government since the cost falls on the companies. "We are doing studies on what we would have done under normal circumstances and do our best to arrive on time."

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