He purchasing power of food minimum wage in Argentina is among the worst in the world, as demonstrated by a recent work by the Latin American Strategic Center for Geopolitics (Celag).
This phenomenon combines two trends: relative increase in the country’s dollar value, associated with a rate of increase of official dollar much lower than the rate of inflation, and on the other hand relative freezing of a good part of the joint ventures. A liter of milk in Argentina costs the same as in France and is more expensive than in Finland and Spain, the report shows. In turn, compared to Latin America, Argentina is the country where the minimum wage allows the purchase of fewer kilos of ground meat.
The minimum wage allows you to buy a similar amount of kilos of rice in Argentina as in Kenya, but Argentina has a price in dollars similar to that of Sweden and Canada.
As for the half dozen eggs, in Argentina the minimum wage allows you to buy a similar amount to what you buy in Tunisia and Nigeria, but the price in dollars is like that of Sweden and Belgium.
Salaries: why they are going to lose more purchasing power than the statistics show
He wage liquefaction effect is going to be deeper this year than what the different surveys, both official and private, may indicate. Due to the increase in rates, the loss of purchasing power of salaries will be greater to what can nominally dilute inflation.
This is stated in a report the consulting firm Abeceb, in which he states that the “disposable salary”that is, the purchasing power of income discounting the liquefaction effect, you will lose up to 15%.
“A worker who on average in 2024 He is going to earn $1,340,000 per month and his salary is going to fall in real terms by 6.1%, which you have left to spendafter paying rent, fuel, transportation, electricity, gas (these components that increase well above inflation) will be $840,000, which implies a drop of 15.5% compared to the disposable income he had last year,” the report states.
According to the latest data on salary evolution prepared by INDEC, in February salaries grew by 8.9% nominally, with 152% year-on-year. Those in the registered private sector rose 11%, the public sector 5% and the unregistered 7.6%. below inflation.
The consultant who directed by former Minister of Production Dante Sica, points out that “the real salary in the formal private sector could fall on average 6.1% in 2024, but disposable income could be reduced more than twice as a result of the strong rearrangement of the relative prices of gas, electricity, water, public transportation, and fuel rates.”
The study maintains that the value of all those Public services “have been adjusting well above inflation, having a strong impact on pockets.”
The retraction of purchasing power occurs within the framework of a very strong process of relative price correction that were very late and that causes people to spend much more than they did before to face those bills, cutting the money available to buy other goods or services.
Source: Ambito
