The Fund points out that the productivity gains (measured by real economic growth adjusted to the working age population) remained “virtually constant” over the last decade, while the minimum wage “increased by 16% during the same period” , which means an annual increase of the minimum wage higher than the increase of the Gross Domestic Product (GDP) by 1.5% over the past ten years.
For the representatives of the IMF, “given the still high unemployment “, raising the minimum wage” may in fact penalize precisely the group that you want to support. “
The institution led by Christine Lagarde said that the impact of the crisis was” particularly felt by workers unskilled and young people “who have lower incomes.
The Fund believes that” measures that increase the cost of employment for these workers, while increase the income of those who have work, will keep high unemployment in these segments longer and delay the normalization of the labor market. “
The government raised the minimum wage to 505 euros a month now after the conclusion of the Economic and Financial Assistance Program (EFAP ), an increase which came into force in October 2014 and was accompanied by a reduction of 0.75 percentage points of the Single Social Tax (TSU) for companies with employees who earn this income.
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