Stop austerity for executive staff


While the minimum wage went up by 2.3 per cent this year and the social security ceiling by 1.8 per cent, minimum salaries for engineers and executives in the metalworking industries in France continue to stagnate. They will not stop regressing until a plan running over a couple of years is put in place starting this year which raises minimum salaries by 3 per cent.

Every year before Christmas the delegations from the 5 representative trade unions in the metalworking industries go to negotiate with the employers’ organization UIMM to bargain on the minimum salaries for engineers and executives. Metalworker engineers and executives have a national agreement, whereas the other categories in the sector have regional pay agreements.

For some years now the increases in engineers and executives’ minimum salaries have not been keeping up. The most glaring case was in 2010 when none of the unions was willing to sign the agreement, when the employers decided to freeze the salaries unilaterally. This has meant that the engineers and executives’ salaries have lost ground compared to the legal minimum wage. It would be wrong to think that this only affects entry level pay. This situation has repercussions at all levels and in all companies in the sector. This back-up has to be made up as quickly as possible. Starting this year a plan has to be put in place to raise the salaries by 3 per cent and continue over the next few years in order to make up for the years of stagnation.

In the current negotiations the UIMM is taking advantage yet again of the crisis to propose a puny rise to the tune of 1.3 per cent. No union has been willing to sign this agreement, which indicates that there is a gap between what the employers are suggesting and what the engineers and executives need. The employers constantly refer to the poor health of the French and the European economy to justify their austerity strategy. In their view expenditures must be cut, which means to cut salaries so that the companies will be better off. The cases of Greece and Spain are, however, great counter examples which show us that national economies cannot work like that.

Cutting salaries means worsening the crisis by weakening growth, which, nevertheless, is fired in France by households’ consumption. On the contrary, households should be given more money in order to get growth going and get people back to work in our companies. Moreover we need to remember that salaries are the payment for workers’ qualifications.

Every year workers increase their qualifications by on-the-job experience as well as by doing training, by acquiring new skills, etc. Wages and salaries thus have to rise in constant money, that is, above and beyond the inflation rate. That is why engineers’ and executives’ minimum salaries have to go up more than the inflation rate, which this year is expected to be 1.7 per cent. Proposing only a 1.3 per cent rise is tantamount to paying less for our qualifications and thus decreasing our standard of living.

The financial press is always very keen on competitiveness. And the comparison between the French and German industry is often the issue. Nevertheless upon closer analysis Germany has boosted its competitiveness on the basis of quality production. In Germany one hour worked costs 43 euros compared to only 33 euros in France. But still German cars sell better and for higher prices.

Besides German output has remained stable at 6.2 million vehicles, while it has gone down in France from 3 to 1.9 million due to short-term policies geared solely to making as much profit as possible to the detriment of industrial development. It is because of policies based on innovation, research and development of new technologies that German industry is flourishing, and not because of cutting costs which is what is happening nowadays in France. German industry attracts highly qualified people, technicians and engineers, by paying them correctly. Instead, all players in industry are seeing young people drift away from industry to work in finance or other better paying sectors.

It will not be by offering a mere 1.3 per cent rise that our companies will turn this situation around. The current negotiations cover engineers and executives, but the other categories in the metalworking industries should keep an eye on these proposals.

Source: CGT Metallurgie