what if the problem was our salaries?

Analyse

Health insurance premiums continue to rise. But isn’t the real problem rather that of wage stagnation? Unions, employers and experts give their opinions.

This Thursday afternoon, we learned that health insurance premiums will increase again in 2025. The increase will be 6% on average. Last year at the same time, it was 8.7%.

While our health insurance premiums rise year after year, salaries have stagnated for thirty years. The figures, the magnitude of which no one disputes, speak for themselves: since the introduction of Lamal in 1997, bonuses cost two and a half times more expensive while salaries have increased by a meager 12%.

The problem is therefore twofold: if premiums did not increase each year, the purchasing power of households would not be impacted. Likewise, if the salaries of the Swiss had continued to increase with inflation, citizens would be able to pay their bonuses without going through subsidies – or prosecution, for some.

The middle class particularly affected

For Sergio Rossi, professor of economics at the University of Fribourg, “it is the middle class that is most affected.” It separates the population into five categories of approximately 20% each: the poorest, the lower middle class, the middle class, the upper middle class and the richest.

The lower middle class is particularly affected. “These are both workers and retired people,” explains Sergio Rossi.

The “basic deal” broken for the unions

Benoît-Gaillard, spokesperson for the Swiss Trade Union Union (USS) and socialist municipal councilor in Lausanne, believes that the problem of stagnant wages and increasing bonuses are linked. “The growing burden of bonuses is all the more unbearable as wages stagnate,” he asserts. It unfolds:

For the trade unionist, the system has been seized up since around 2016. “Real wages have stagnated since then, even when adjusted for inflation.” The Vaudois even considers that it is a notable historical event. “When economic conditions are good and productivity continues to increase, wages should rise.”

He also notes an “unfair” distribution of health costs: the same 8% increase arriving in 2024 is suffered in different ways. “For a family, this increase can represent almost 100 francs more per month. We suffer it more harshly with a median salary of 6,700 francs than with a salary four times higher,” notes Benoît Gaillard.

Employers defend social partnership

On the employers’ side, we reject this link between the two curves: “There is no correlation between salary and bonuses, they are two perfectly independent things”, estimates Marco Taddei, of the Employers’ Union Swiss.

As for stagnation, he also disputes it: “Between 2012 and 2022, there was around 0.3% annual increase in real wages. Wages are increasing slowly, but surely.” Certainly, but still too slowly in the face of bonuses? Faced with employers, the unions are demanding a 5% increase. “The increase in wages cannot be decreed from Berne like the announcement of bonuses,” retorts Marco Taddei.

The employers’ representative, however, hopes that each sector will be able to find agreements that satisfy both the workers and the unions and the employers, like the signing of the recent collective labor agreement in the watch industry, which concerns 500 companies and nearly 55,000 employees.

Another element which explains the stagnation – or weak increase – of salaries is the number of part-time workers, which is increasing. “They can be suffered or chosen. According to the Federal Council, a majority of them are chosen,” indicates Marco Taddeï. “The majority of part-time jobs are held by women, particularly young mothers. Incentive measures for crèches could help increase productivity,” he analyzes.

A risk of disintegration

The fronts are therefore frozen in the theater of salaries and out-of-tune dialogues. In this wake, the idea of ​​a single fund is also resurfacing, particularly at the cantonal level. The other idea coming from the socialists is bonuses financed based on a percentage of salary.

But Sergio Rossi does not see a short-term solution in the current framework. He warns against “two-tier medicine”, as in Italy and Greece, where some less fortunate citizens give up seeking treatment for financial reasons.

But the main problem is not there for the professor, for whom the “financialized regime” of the current state of the capitalist economy is to blame. “Most financial activities do not create wealth in the macroeconomic sense of the term,” he notes.

Will salaries rise over the next five or ten years? Sergio Rossi is categorical:

This article was initially published as part of the Socialist Party’s initiative on bonus relief, rejected by the people on June 9, 2024.