Professional mobility, a powerful lever for increasing purchasing power

To support the purchasing power of the French, successive executives have demonstrated endless imagination: checks, purchase bonuses, price shields, pump bonuses... However, there is a much simpler path , effective and long-term, argues in a note published today by the Rexecode economic institute; it’s about doing everything possible to support productivity.

As we know, this measure of work efficiency has continued to decline for several years in France. It has even declined by around 5% since 2019, while it increased during the same period among our European neighbors. However, for Rexecode economists, it is this impressive drop in productivity which explains most of the deterioration in the purchasing power of employees in recent years.

The thesis of a distortion of added value in favor of capital, in other words of a desire of companies to increase their margins to the detriment of wages, does not in fact stand up to examination, when we know that "the share of wages in added value contributes positively to their overall evolution (0.3%)” from 2019 to 2023, according to the study.

However, “the good news is that this slowdown in productivity is mainly the result of dynamic employment. Of the five points of decline, around two points come from the increase in the number of apprentices following the latest reforms and two points from the fact that job creation in recent years has mainly taken place in less productive sectors than the such as commerce or accommodation and catering, and by integrating less qualified or experienced profiles,” says Olivier Redoules, director of studies at Rexecode.

Over time and training, the cohort of apprentices massively integrated in 2022 should improve its productivity and reach the national average. As for the question of the attraction of non-productive sectors, for Rexecode it is addressed from two angles. “We must let the price signal play its role so that employees are encouraged to move towards the most profitable sectors,” argues Olivier Redoules. We should not seek to homogenize salaries between sectors and companies. Artificially compressing salary scales would slow down this movement of reallocation between sectors, which is a driver of productivity gains over time.

To then enable employees to move towards the most productive and remunerative professions, the subject of labor mobility still needs to be addressed. “This refers in particular to the problems of geographical mobility, in particular in terms of the supply of housing, transport and services to families,” specifies the study.