According to INSEE, the average net salary decreased by 0.8% in constant euros in 2023, after -1% in 2022. Sandrine Dorbes is a compensation consultant. She provides advice to companies to help them define their salary policy and comments on this study.
Companies claim to have made great efforts on salaries over the last two years. Is this really the case?
We hear a lot that salaries have kept up with inflation. This is something I don’t necessarily see in my clients. Low wages were supported by the increase in the minimum wage. There have also been many targeted measures, particularly in societies where budgets are the most fragile. But general increase measures have not been taken in many companies. For several years we have had one crisis after another and one band-aid measure after another, hoping that the situation will turn around.
Is this bad will on the part of companies?
We always take very bad students as an example. We show companies making a lot of money and not sharing the profits enough. I have clients who really don’t have the means. An SME manager explained to me that payroll represents 60% of its turnover. It’s colossal. The room for maneuver is very tight. With a horizon that is not very clear from an economic point of view, taking a big hit on salaries to improve purchasing power is not always viable in the medium term. So there are salaries that are lagging behind, particularly those of executives. Very high salaries continue to increase. Low wages were supported. but in between, there are people who have been a little forgotten.
“For several years we have had one crisis after another and one band-aid measure after another, hoping that the situation will turn around”
What is the risk?
We hear a lot that inflation is slowing and that with the increases in 2024, we will return to an upward trend and repair the negative effects. I find it optimistic and awkward. People who have lost purchasing power will not be happy with the good statistics. There is a risk of dropping out, less motivation, less understanding and less commitment on the part of employees. They may ask themselves: “Why am I working? » It’s human, there is a need to project oneself in time. Compensation is both a technical and emotional subject.
What can companies do that can’t raise wages?
What companies are starting to be interested in is working on social benefits. There is a real way to improve purchasing power. With restaurant vouchers, of course, which you can use to do your shopping. And if we can’t increase salaries, we can also give vacation vouchers. These are less busy alternatives that can be more easily returned to. There are more and more platforms that allow you to mix these social benefits. An envelope is allocated to each employee who can choose to spend it however they want, to play sports, go to a restaurant or go on vacation.
