The government is celebrating the increase in the minimum wage, while its policies have sent the cost of living skyrocketing
We are now one day before the fourth increase in the minimum wage by the Mitsotakis government. From tomorrow the minimum wage will be 830 euros, a percentage increase of 6.1%. Essentially, this increase directly concerns about 700,000 employees out of a total of 2.29 million. According to the annual report of the ERGANI system that measures wage labor, 709,712 are wage earners who receive a wage equal to or less than the minimum wage. Among them are 284,134 who are paid less than 500 euros (part-time or rotating employment). Indirectly, the whole world of wage labor is affected, since this increase offers bargaining power in industries where there is a lot of mobility, as wage earners demand an increase in their salary that is above the minimum wage threshold.
Although the relevant announcement was made last Friday, the celebrations for the sensitivity of Kyriakos Mitsotakis towards the low-paid began on Thursday. The immoderate statement of the government representative Pavlos Marinakis is typical: “The minimum wage from 650 euros in 2019 has reached 780 euros, while the average wage has reached 1,251 from 1,046 in 2019” he noted and added: “The numbers speak for themselves and don’t need much explanation.”
Indeed, throwing out numbers and not explaining helps the government’s narrative that we live in the country that has an amazing quality of life. But if someone explains these numbers, they will find that we live on the fringes of Europe and we are in danger of being the first European country with a Latin American economy, where the many are crushed so that the few can live richly.
Truth and falsification
In fact, the Mitsotakis government has made four increases in the minimum wage since 2022. But Mr. Mitsotakis took over as prime minister in 2019. Under the pretext that the Tsipras government gave excessive increases at the beginning of 2019 (10.91% and abolition of the minimum, which meant an increase for young people aged 18-25 of the order of 27.22 %), the prime minister known for his lack of social sensitivity, hiding behind the pandemic crisis, refused to give increases in 2020 and 2021.
But the inflationary pressure brought on by his pro-cartel policies – along with the crisis in supply chains caused by the pandemic and Russia’s invasion of Ukraine – forced him to institute increases in an attempt to ease the cost-of-living crisis brought on by profiteering inflation. It is typical that the Organization for Economic Co-operation and Development (OECD) in its last year’s research concluded that in Greece the average nominal gross salary in 2022 increased by 1.5% but the average real salary decreased by 7.4% due to inflation. And according to the latest data from the ERGANI system, the average gross earnings of the 2.29 million employees in 2023 are estimated at approximately 1,250 euros (net earnings on a twelve-month basis of the order of 983 euros).
Cost of living increase over 30%
Now we are facing the new increase and the attempt of the rulers to convince us that they care about the society. However, the increase alone does not change the fact that Greek consumers are devastated by the profiteering on the supermarket shelves. Average inflation may have increased in 2023 to 4.2% (of course added to 9.7% in 2022), but this increase distorts reality.
It is obvious that the vast majority of the country’s productive potential, who each month collect from their work an average of 983 euros (net earnings), spend this money on basic needs. The ever-reliable GSEE Labor Institute (INE/GSEE), considering that a household’s standard of living depends on the change in prices in the categories of goods and services that make up their consumption pattern, has narrowed the search for the evolution of the Consumer Price Index to four basic categories of goods and services, which cumulatively absorb the largest share of household consumption.
From this analysis it follows that the increases in food from 2020 to the end of 2023 are 31.2%. Accordingly, transport costs increased from 2020 by 21.1%. Finally, in the category “Hotels, cafes, restaurants” there is an increased cost in December 2023 by 15.2% compared to the corresponding month of 2020. On the other hand, housing was more expensive in the last month of last year by 20.3% compared to with December 2020!
All this constitutes the explanation of the numbers cited by the Mitsotakis government in relation to the increase in the minimum wage and shows the suffocating reality of Greek society from the Mitsotakis administration…
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