“We are putting businesses in the trap”: the boss of Medef fears an increase in the minimum wage which would be added to the elimination of contribution reductions planned in the 2027 budget

Increasing the minimum wage to "buy social peace" risks "creating chaos in businesses", declared Friday the president of Medef Patrick Martin, in particular because of the increase in the cost of labor planned in the Social Security budget. According to information published Thursday by Les Échos, the government plans to bring forward by a few weeks the mechanical increase in the minimum wage normally set for next January 1, which could be 1%, or 15 euros net per month. This possible decision "does not raise eyebrows among employers", said Patrick Martin on Friday on France Info.

“If there is a boost, why not,” he declared, but it would be “on top of” the reduction in employer contributions planned in the government’s draft budget, which he estimates at around 9.3 billion euros (compared to 3.7 billion according to the government). “That is to say, we are putting businesses in the trap,” he said. “In order to buy, in some way, social peace in the street, we are going to create chaos in businesses,” said Patrick Martin, on the eve of new demonstrations against the “high cost of living”.

He added that "companies will not be able to cope with demands for salary increases", taking the example of a company in the cleaning or catering sector, which generates around 2% net profit: "If the minimum wage increases by 1 point (...), then we put it at a loss. (...

) We are going to make companies go bankrupt". In the morning, the general secretaries of the CFDT and the CGT, Marylise Léon and Sophie Binet, both judged the government's proposal "insufficient" in the face of the crisis. They both asked for an increase in the minimum wage of 100 euros, or around 10%, in order to revive consumption.

Transfer of expenses from Social Security to supplementary health insurance According to the president of Medef, the government's draft budget for Social Security for 2027 would impose 11.5 billion euros in "additional labor costs" on companies, by transferring expenses from Health Insurance to supplementary health insurance but above all by reversing certain reductions in charges, which would have a cost of 9.3 billion euros for companies according to Medef. A cost much higher than that put forward by the government (3.7 billion), but which also includes measures already taken this year, including the freezing of reductions decided in 2026 which deprived companies of 2.8 billion in additional reductions this year. These sums will “no longer be available” to increase salaries, argued Patrick Martin.

Conversely, the government, but also economists, point to the fact that these reductions on low wages discourage companies from increasing the remuneration of their employees. On the eve of a new day of strictly supervised mobilizations, the president of Medef also called on the State to take “much stronger measures” to protect property and people. “Do not fall into self-defense” According to the network of chambers of commerce and industry in France (CCI France), more than 2.

Machine-translated from French