2023-04-25 19:18:54
Posted Apr 25, 2023, 7:09 PMUpdated on Apr 25, 2023 at 7:18 PM
This is one of the subjects which should be on the agenda of the discussions which will take place between the social partners at the request of Emmanuel Macron within the framework of the “pact of life at work” that the head of the State calls for its wishes. Career progressions within the company become a cause for concern. “The social ladder in the company is not blocked, but it is slowed down”, alerted the president of Medef, Geoffroy Roux de Bézieux, guest of the grand jury RTL – “Le Figaro” – LCI on Sunday.
A second subject in the subject has recently appeared, according to the boss of the employers’ organization: refusals of promotion. “Between one and two SMICs, when wages are increased by 100 euros, there are barely 30 euros left in the employee’s pocket,” he explained. In other words, “there is a diminishing return to promotion,” he points out.
Degressive benefits
“This is one of the specificities of France, confirms economist Gilbert Cette, professor at Neoma Business School. It is due to the stacking of low-income support systems, ”according to him.
On the employers’ side, the weapon of reductions in charges on low wages, less than 1.6 times the minimum wage (where the charges are now zero), has been used to promote employment.
On the employee side, so that work pays more, various allowances aim to provide additional income and support the purchasing power of low wages: the active solidarity income (RSA) and the activity bonus. Finally, there are housing benefits. Just as many degressive benefits that decrease and can disappear when income from work increases. What dissuade the employees to go up in rank in the company. And employers to increase them.
“Coherence”
Let’s take the example of the activity bonus: from half the minimum wage, it benefits from an individual bonus which increases to 1 minimum wage. It then decreases and stops when the employee receives 1.3 SMIC.
“According to OECD calculations, for a full-time single person, the ratio between the income he receives at the minimum wage and that which he receives if he receives the median salary is 80%. France is the country where the ratio is the highest,” points out Gilbert Cette. This finding therefore raises the question of the overhaul and consistency of social assistance “to avoid discouraging professional mobility and training”, says the expert.
Problem: the executive obviously does not intend to cut corners on the activity bonus or on the reductions in charges at the minimum wage. One solution would be to further smooth the scales (with higher exit points), in order to reduce the low-wage trap effect. But this would imply further increasing the cost of these devices.
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