Regardless of the method used to calculate inflation, it is increasing, and more strongly than expected!
In France, inflation has been 3.95% on average since January or 4.8% in April (over 12 rolling months).
While inflation in Europe is above 7%, the shock has been cushioned in France thanks to nuclear power and the implementation of government measures to contain energy prices.
Inflation rates 04/2022
• Germany : 7,3 %
• USA : 8,5 %
• Spain : 9,8%
The main consequences of inflation are:
A potential drop in margin for companies
Price increases began a year ago due to the strong economic recovery (world GDP: +5.9%, French GDP: +7%). The price of energy and the cost of raw materials have soared. The strong dependence of countries on China, paralyzed by the COVID crisis, continues to impact the prices of many components (especially electronics), the prices of packaging, transport… and consequently the prices of manufactured products.
A real drop in purchasing power for households
The conflict between Russia and Ukraine amplifies economic instability: an increase in oil, gas, and electricity, an increase in basic necessities, risk of food shortages become problematic for the budget of employees.
In addition, many employees, without the possibility of teleworking and/or not having access to public transport, are subject to additional financial pressure and are experiencing difficult end-of-months.
• The price of energy has increased in France by 26.6% for 12 months
• The price of food has increased by an average of 3.8% over the past 12 months
• The price of a barrel of oil has increased by 59% in 12 months
Schneider has succeeded in safeguarding its margin by price increases,
Schneider must at the same time increase wages!
Economists and the ECB forecast weak or even flat growth and inflation that should approach 10% in the Euro zone this summer.
However, Schneider's results for the first quarter of 2022 are up 10% at the group level and the forecast between 7 and 9% is maintained.
France registered a record level of orders with a good level of invoicing. While the minimum wage increased by 2.65% on May 1, i.e. nearly 6.9% since 01/01/2021, Schneider's salary plans since 2021 are only 4.6% in total.