The data becomes relevant in the context of the negotiations promoted by the government with the employers of the Argentine Industrial Union (UIA) and the unions of the General Confederation of Labor (CGT), with whom he tries to moderate the inflationary impulse of the first months of 2022, affected by the increase in the prices of raw materials at a global level due to the war in Ukraine.
The agenda of the tripartite meeting includes among its points the objective of recovering purchasing power of wages. Thus exposed, the objective cannot be rejected even by the employers themselves who have to pay the salaries. It’s just about putting concrete numbers.
The effect of loss of purchasing power is correlated with the unemployment data. The proportion of unemployed people stood at 7% towards the end of 2021, which marks a low level, which would be explained by the hypothesis that the employment variable adjusted these years by price instead of quantity.
The IARAF report says that in the last 48 months, formal wage earners spent 30 months in which their salaries lost against inflationinformal workers gave up purchasing power for 34 months and public employees for 33 months.
If retirements are also included, “in the last year, considering the four population sectors, they received a lower income in terms of purchasing power than the year taken as a base (February 2017-January 2018)”, says the report.
When comparing nominal earnings with inflation, the most affected sectors would be the informal workers. The latter lost 8.5% of purchasing power on average per year. Then, they are followed by the public sector with 6.1% and retirees who receive the minimum amount with an average annual loss of 5.3%. Formal wage earners lost 4.5 points throughout the period.
Registered private wages hit the bottom in January 2021 with a drop of 18.7% and then recovered 3.6% until January of this year. For its part, wages in the public sector plummeted 25.3% until May last year and recovered 5.8%. And the salaries of the non-registered private sector collapsed 33.4% until September and then recovered 4.5%. The data also reveals that through joint negotiations of short modalities with anti-inflationary clauses, the unions managed to gain some of the ground resigned in previous years. The employers of the UIA are clear about this number, which explains why they reject some type of compensatory bonus by decree since they consider that it is not necessary.
Seen in another way, the IARAF specifies that if the amount of goods and services that could be consumed with a salary between February 2017 and January 2018 is taken, In the last 48 months, registered wage earners lost the equivalent of 6.3 salaries, informal workers 10, and public employees 7.9 salaries.
A separate fact is the pensions after the change in the updating formula. The Government had to appeal on several occasions to compensatory bonds to prevent them from collapsing. The IARAF estimated that for the minimum pension the lowest real value was reached in May 2021, implying an initial drop of 24.5% and a recovery until January 2022 of 9.4%. But if you consider the impact of aid from the Executive Power the minimum took place in February 2021, with a fall of 21.3% and the recovery to January of this year is 4.9%. The IARAF estimated that each retiree of the minimum lost in the last four years $193,000 of purchasing power.
Source: Ambito
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