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It is good for raising the minimum wage?
The PROMISE TO ELEVATE IT To 800 EUROS REOPENS the DEBATE - the costs and benefits of the legal minimum wages are controversy object - the employer's association and the PP warns of the inflationary risks and the increase of unemployment - the fact to have the SMI of 570 Euros allows that there is mileuristas', affirms a MADRID economist. - The convenience of raising Multi-industry Minimum Salario (SMI) contains value judgments. Not even the economists agree themselves, who spill contradictory affirmations in a debate that less than affects of direct form to 1% of workers - 200,000 people, the majority women who receive this repayment in Spain. The UGT and CCOO have proposed to the Government and the industralists to raise to the minimum wage an annual 8% during next the eight years, which would place its quantity in 816,5 monthly Euros in 2012 and 1.111, 1 Euros in 2016. It would be arrived then at a level equivalent to 60% of the net wage half recommended by the European Social Letter (CSE), subscribed by Spain in 1985 and that constitutes an historical demand of the unions. The 800 Euros with the view put in 2012 are “a feasible” objective - according to the Ministry of Work that the president of the Government, Jose Luis Rodriguez Zapatero, has transformed into electoral promise. The vice-president second and minister of Economy and Hacienda, Pedro Solbes, customary to use the hand brake, has been more cautious. The SMI has become ideological a hand-thrown weapon of transfondo on which in many aspects there are more lights and shades. These are the many-colored opinions on the matter of the consulted economists. What benefits can have to raise it 800 Euros? First it is that the people receive who it will see improved their buying level, affirms of sharp form the economist of the economic cabinet of CCOO Carlos Martin. Also it can be positive in terms of productivity. The director of the department of Economic Policy of the Faculty of Economy of the University of Alcala of Madrid, Francisco Villota, emphasizes that “even he can have a favorable effect on the efficiency of the worker, when falling the rate of rotation of the employees and increasing his implication with the company”. That yes, whenever one is a “moderate increase”. There am one of the algid points of the debate here. What is the moderate thing? The professor of the IESE Jose Ramon Pin indicates that the greater problem is “to find the balance point that allows to improve the standard of life of the people receive who it without fomenting unemployment in the favored classes less”, than are, indeed, to that it tries to favor an ascent of the SMI. “At the moment it receives less than 1% of the workers, which of some form means that well it is calculated because it defends to a minimum part of the population”, it adds Pin. The most liberal economists, explain east expert, are opposite to settle down a minimum pay because they interpret that the one is the market that must determine that threshold. “From a point of view of social sensitivity and having in that sometimes abuses on the part of employers take place, the SMI becomes an instrument for the people who have more difficulty at the time of defending itself”. Villegas also stands out that the SMI works like “a species of safety net, of mattress so that the wages do not lower excessively”. In its opinion, “the fact that we have a minimum wage of 570 allows that there are mileuristas; not perhaps if we would be speaking of “setecientoseuristas””. What detrimental consequences can have? The employer's association has indicated like “danger” of this ascent that can be produced a “effect contagion” in the collective negotiation of the minimum wages of labor agreements if the unions press with ascents that the companies are not prepared to grant. But, according to the economist CCOO, “which moves to the unions to demand ascents of minimum wages in the agreements are not how it is the SMI, but the fact that the economy and the industralists create works of very bad quality”. The Spanish Confederation of Enterprise Organizations (Ceoe) puts the accent in the bullish risks for the inflation that would have an ascent pronounces of the SMI. From CCOO they assure that taking as reference the deflactor of the GIP is stated that half of the ascent of prices from 2004 must to the rise of the enterprise margins and that the ascent of the wages is only responsible for a third of that increase. While, the president of the PP, Mariano Rajoy, is outstanding that, besides increasing the prices, can restrain the use creation. “There is no empirical solid base demonstrates that it”, Villota explains. Which is the best moment to raise the SMI? Again, discrepancies. “The best thing is to do it when they lack workers for the companies. I do not believe that it is the case right now, indeed to be decelerating the economy”, affirms the vicedean of the Faculty of Economic and Enterprise Sciences of the University of Navarre, Brown Antonio Ibáñez. Villota laments that now “the conjuncture is politicized psychologically”, which conditions the debate, and emphasizes that “it is not necessary to magnify the importance” of this ascent because “in no case is going to suppose the collapse of the economy”. What effects can have in the labor categories superiors? No direct one, because usually they are not tie to the SMI. In this point all the consulted economists agree, since this repayment benefits all the people who are not covered by the collective negotiation. “We lived in a very competitive world in which a policy cannot be done of indiscriminate ascent of wages, because in the economies open and globalized this it has an immediate punishment”, affirms on the other hand Villota. According to this economist, unions and employer's association already have demonstrated to have “a sufficient maturity”. Which has been the evolution of the SMI? In which it goes of legislature, the minimum wage has reached an accumulated increase of 17.4% against 17.7% that raised between 1996 and 2004, according to data of the Ministry of Work. For 2007 the minimum wage for any activity was certain in 19,02 Euros per day or 570.60 Euros to the month, reason why it is considered illicit to contract a worker by a smaller pay. The Government has affirmed that he is on the verge of closing the agreement with the social agents to elevate it to 600 Euros from next the 1 of January, which supposes the fulfillment of the electoral program with which the Socialists appeared in 2004. Its quantity fixed annually the Government, by means of Real Decree, previous consultation with the union organizations and more representative enterprise associations. For it the index of prices to the consumption considers (IPC), the national average productivity and the economic conjuncture, among others factors. (The extracted News of the World)
 
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