From November 1, 2024, the SMIC (minimum wage) will be raised by 2%, bringing relief to many employees in the face of persistent inflation. This decision, announced by French Prime Minister Michel Barnier, will take the salary above the €1,400 mark. This increase, more generous than the averages of the last ten years, is in response to inflationary pressure that is particularly affecting modest households. Find out why this increase has been brought forward, and what it means for the months ahead.
The SMIC will be increased on November 1, 2024. Traditionally, this annual increase takes place on January 1, but this year it has been brought forward by two months. There will be no further increase in January 2025. In France, the Smic is the only wage adjusted for inflation. It is automatically increased every year on January 1, with further adjustments during the year as soon as inflation exceeds 2%. The government may decide to grant an additional increase, known as a "coup de pouce", although there has been none since 2012. In the current case, this is merely an "anticipation".
The minimum wage will increase by 2%. This increase will take the gross hourly SMIC from €11.65 to €11.88, and the net monthly SMIC from €1,398.7 to €1,426.67 for a 35-hour week. This is higher than the average increase of 1.11% over the past ten years. From November 1, 2024, the gross monthly SMIC will be €1802.25.
The decision to bring forward the wage adjustment to November 1 is in response to the high inflation that has particularly affected low-income households. The SMIC is indexed to inflation for the lowest 20% of households, and this year inflation has been higher than in previous years.
No, there will be no further increase on January 1, 2025. The 2% increase scheduled for November replaces the increase that would have taken place at the beginning of the following year.
The SMIC is revalued each year according to theinflation rate observed for the lowest-income households, as well as the change in purchasing power of the average wage for blue-collar and white-collar workers. If inflation exceeds 2% during the year, an automatic revaluation may also take place.
No, this is not an exceptional increase, but an anticipation of the usual annual revaluation of the SMIC, which would normally have taken place on January 1. However, the 2% increase is still higher than the average observed in recent years.
Yes, since January 1, 2021, the net SMIC has risen from €1,230.60 to €1,426, an increase of 16%, higher than inflation, estimated at 15.1% over the same period. Some sectors are having to adapt their pay scales to keep pace with the SMIC, as minimum wages are sometimes caught up by this faster rise.
Prime Minister Michel Barnier also spoke of the need to reviewsocial security exemption schemes for the minimum wage, which, according to some economists, could limit wage growth by creating "low-wage traps". The government would like to adjust these mechanisms to better support income growth.
In short, this increase on November 1, 2024 will give employees earning the minimum wage a net salary of €1,426.67, a relief in the face of persistent inflation that will only get worse as the year draws to a close...
