With the devaluation leap defined by the Government last Monday, which set the wholesale exchange rate at $350 per dollar, and the impact it already has on prices, wages they were weakened by the inflation. In fact, private estimates that were known in the last few hours were already out of date after the financial shock after the elections.
“From the economic events of the last few days it is highly probable that companies will begin to take some measures to alleviate the impact of inflationbut it is still too early to anticipate what they may be,” explained Marcela Angeli, director of Work & Rewards for WTW.
The consultancy had surveyed more than 440 companies at the end of July and beginning of August, which on average already gave a 45% increase up to the middle of the year, which they estimated to close 2023 with an increase of 120%, although they projected inflation of 130%. This is always talking about the salaries of employees outside the agreement, mostly executives.
However, the latest events modified the market’s inflation estimates, which are already speaking at approximately 180%.
Added to this, there are already several unions that claim to reopen parities to discuss a salary increase that moderates the inflationary impact on the pocket of workers in agreement.
One of the options, according to the consultant, is for the “companies to advance the salary adjustments that they had planned for the months of September/October. Surely by the end of this month or the beginning of the next we will have a clearer picture from the companies about of other actions/measures they may take”.
It is that, when consulted, 39% of the companies said that they were negotiating changes in their increase budget, a number that will surely rise, since those who were not discussing modifications were waiting for the evolution of inflation, what the market was doing or what was happening with the union of the activity.
“Regarding the previous edition, it appears that the estimates of salary adjustments continue to grow (between 3 and 5 points according to the statistical measure considered); and this is totally related to the uncertainty regarding inflation. Which is considerably aggravated from the results of the PASO elections,” said Angeli.
Regarding turnover, that is, the people who leave companies, the specialist highlighted that “involuntary turnover grew from 18% to 34% in the last semester, which means that more companies made the decision to leave employees to the fact that it is the employee who decides to leave the company”.
What is also consolidating is the number of companies that this year granted 4 adjustments and more.
Looking ahead -and in the midst of this situation guided by uncertainty-, 77% of the companies said that they had not yet begun to think about how much the 2024 salary increase could be. It is possible that this definition will be delayed due to the election year.
Of the 33% that are analyzing their budget for next year, the average estimates that they will apply increases of 107%, with inflation estimated at 114%.
Source: Ambito
