Inflation: the Smic will increase "by a little more than 2%" on May 1, according to Elisabeth Borne

Barthélémy Philippe, with AFP 19:37 p.m., April 14, 2023, modified at 19:38 p.m., April 14, 2023

Prime Minister Elisabeth Borne assured Friday that the Smic would increase "by a little more than 2%" on May 1 and called on companies to "renegotiate wage scales" to defend purchasing power after inflation in March a little higher than expected.

This inflation, which reached 5.7%, slightly more than the 5.6% initially forecast by INSEE (National Institute of Statistics and Economic Studies), will mechanically lead "to a revaluation of the Smic on May 1 of a little more than 2%", bringing to 6% its increase over one year, explained the head of government during a trip to Hanches, in Eure-et-Loir.

An increase of 2.19% according to Olivier Dussopt

According to the office of Labour Minister Olivier Dussopt, the increase will be 2.19%. The monthly net minimum wage will thus be increased from 30 euros to 1,383 euros for a full-time 35-hour week. The lowest paid civil servants will also benefit from an increase in their salaries so that none of them are paid below the minimum wage, the Ministry of Public Service said Friday evening.

"The salaries of public officials whose salary would fall below the value of the gross minimum wage on May 1 will be increased, according to modalities that will be specified in the coming weeks," said the ministry. The last revaluation of this kind, on 1 January 2023, had concerned more than 400,000 civil servants (out of 5.7 million public employees in France).

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Soaring prices avoided thanks to the "anti-inflation basket"

During the visit to a hypermarket, which was interrupted several times by some demonstrators hostile to the pension reform, Ms. Borne called on companies to "renegotiate as soon as possible the wage scales" for employees so that employees who earn a little more than the minimum wage are not penalized. "I invite all professional branches and all companies that can to mobilize also to respond to this first concern of the French which is purchasing power," she said.

During this trip with the Minister Delegate for SMEs, Olivia Grégoire, the Prime Minister also assured that the "anti-inflation basket" set up by large retailers had made it possible to avoid a sharp rise in prices. "Thanks to the anti-inflation quarter, with this commitment of distributors to cut back on their margins to protect purchasing power, we were able to avoid this surge in the prices of food and hygiene products," said the head of government.

>> READ ALSO - Anti-inflation basket: a "trap", according to Michel-Édouard Leclerc who wants to "do more"

A revaluation in response to inflation

She also assured that "for all the brands that have committed to the anti-inflation quarter (which expires on June 15), on the products that are in the basket, prices have fallen by 5% on average". She estimated this drop at 7% for the Système U network, of which she visited one of the stores. This move comes after the publication by INSEE of final inflation estimates for the month of March driven by the surge in food prices, its main driver.

The minimum wage benefits each year from a mechanical increase on 1 January which takes into account the weighted price increase for the 20% of households with the lowest incomes. Revaluations also take place during the year as soon as inflation exceeds 2%.