What are the reasons for revalued wages due to inflation in France?


Inflation or the generalized and lasting rise in the prices of goods and services has remained more or less low over the past three decades. It was between 0 and 3% and sometimes 4% in France. Inflation was even zero between 2015 and 2016 in the country.

However, it experienced a sharp increase towards the end of the first half of 2021 to be around 6.5% in France, 9.1% in the euro zone and 10, even 20% in other countries. .

Raising wages is one of the solutions to which leaders have turned to deal with this unprecedented phenomenon. Discover here the causes of inflation and wage increases in different sectors of activity in France!

The causes of inflation

To find the current levels of inflation in Western countries, we have to go back to the 1980s. Indeed, it is a rather complex phenomenon which is currently explained by a set of causes divided into two categories. These are cyclical and structural causes.

Cyclical causes

Conjunctural causes relate to the situation and circumstances of the moment. Thus, the first that explains inflation and the current economic situation is obviously the health crisis linked to the Coronavirus pandemic. It paralyzed most economic activities.

After two years of health crisis, we observed the phenomenon called base effect. The reference level used to measure inflation was particularly low. Additionally, during the gradual business resumption after the pandemic, almost all consumers wanted to catch up on some or all of their deferred demands.

In this context, companies have easily raised prices to compensate for losses without losing customers. Consumers therefore feel this increase on their wages. You can consult This site to inform you about salaries in France.

In addition, the reopening of markets after the pandemic has also led to strong demand for many products against a fairly limited supply: prices are therefore rising logically.

The war in Ukraine is also a temporary cause of inflation. The invasion of Ukraine by Russia is the basis for the increase in prices of various raw materials. These are among others:

  • Oil ;
  • The gas ;
  • Oil;
  • Wheat, etc.

Similarly, the sanctions imposed by international organizations against Russia have forced many states like France to change their supply system.

It is a very expensive and very complex process which is obviously noticeable on the cost of living for consumers. The euro, which has roughly the same value as the dollar in 2022, has also reinforced the effects of imports.

Structural causes

As a structural cause of the inflation observed in 2022, we distinguish the effect of the law of supply and demand which prevented companies from satisfying all the demands after the pandemic.

Similarly, with the increase in the price of energy and gas, the cost of production has increased for companies. They are therefore forced to raise prices in order to stay on the market.

There is also the monetary policy of central banks which played an important role in the surge in prices. Called quantitative easing, it consisted for years of massively buying financial assets and public debt to inject a maximum of liquidity into the economy, in order to revive it.

This policy has long created inflation in financial assets. However, with the large volume of liquidity created and with the limited production potential, inflation became widespread.

Salary increases in different sectors of activity

Raising wages is an ideal solution to deal with inflation. You can have more information here on techniques to increase your purchasing power. Moreover, the salary increase is not uniform. Certain sectors of activity have been more “privileged” than others.

transport and logistics

We take note that average salaries experienced an increase of around 2.2% in France, but with a great disparity in different sectors. With the economic recovery plan, French industry is strongly boosted.

There has been a great increase in its activity, which makes it possible to deal with the structural deficit of the sector. Thus, we have a salary increase of 3.8% in the transport and logistics sector in France. In addition, records are held by certain functions such as:

  • Planning Technician (+6.8%);
  • Logistics Manager (+5.9%);
  • Provisioner (+5.7%).

This is the sector in which the revaluation of wages has been the highest.

Construction

On the barometer, the Building and Public Works sector is the second with a sharp increase in revaluation. The average increase is 2.7%. Despite the increase in the price of materials and other unfavorable factors, the construction industry continues to be a major provider of employment.

This is what explains the fact that the sector has experienced this increase in wages. In addition, the revaluation of the remuneration of the site manager is 4.5%, that of the construction designer by 3.5% and the building studies technician by 3%. These functions record the best performances in this sector.

Banks and insurance

Despite the pandemic and the health crisis, the sector of banks and insurance has never ceased to perform, in particular thanks to the demand for real estate loans and savings. They have therefore allowed the sector to stay afloat and in 2022 we observe an average wage increase of 2.6%.

Among the most rewarded functions, we have the insurance accountant who sees his salary increased by 5.8%. The security engineer and the IT manager meanwhile have a respective increase of 5.3% and 4.9%.



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