He wage index July increased 7.5% and, for the fourth month in a row, exceeded inflationwhich in that month was positioned in 4%, as reported by the National Institute of Statistics and Censuses (INDEC). So far in 2024, the average salary increases 98.1%, about 11.1 percentage points (pp) above the price variation (87%).
However, in the last 12 months, all segments that make up the index continue between 27.9 and 93 percentage points below the CPI. Those who lose the most are statewhich increased 170% year-on-year against an inflation of 263% in the year. Registered private salaries rose 235.1% and unregistered salaries rose 178.9%with a loss of 27.9 and 84.1 pp, respectively.
Average salaries increased in July thanks to the improvement of 6.3% in the private sector; of the 6.7% in the public and of an important 15.1% in the unregistered private. Each sector accumulates, in the first seven months of the year, with inflation up to July of 87%, an increase of 105.8%, 84.9% and 95.4%, respectively. In this way, the only sector that shows losses against the consumer price index (CPI) is he public.
Salaries: why is the improvement not yet reflected in consumption?
The data on the improvement in salaries for the fourth month in a row continues without being reflected in the economy and consumption. Furthermore, as an indication that the improvement in salaries does not impact the real economy, there is the recent poverty data, which showed that in the first semester of the government of Javier Milei More than half of Argentines (52.9%) are in this condition and 18.1% are in a situation of destitutionthat is, it does not cover basic needs.
“If the real interannual variation of the partial accumulated wages is considered, a fall is seen in the case of the public sector (-24%), fall in the registered private sector (-10.6%) and fall in the unregistered private sector (-35.0%). The latter is the one that has lost the most purchasing power for years,” remarked the IARAF economist, Nadin Argañaraz.
Although the July salary data should impact the inflation data for the second semester, so far, a motorized economy is not observed thanks to this credit updates. In turn, from the consultancy Synopsis pointed out, in their Union Panorama, that The Government asked the unions that salary increases from October onwards do not exceed 2%.
“For now it is a suggestion, which could seek to be implemented through the non-approval of agreements,” they emphasized from Synopsis.
“The Government capped the parities because the parities are an invention of inflation and, in that sense, I agree. In any country in the world, salaries increase once a year based on a budget, the financial flow and an employment report and stability of the private sector and living well. In any country in the world, in January an essential good costs more or less the same. No matter how equal it is, we see that salaries continue to fall. For me it will be a. chaotic December, poverty is going to increase much more and salaries are going to continue to decline,” said the lawyer specializing in public employment policies, Juan Pablo Chiesa.
Within the unions that continue to fight for their parity There are the university students, who after the Government’s advance of an imminent veto to the financing lawthey have already summoned a new Federal University March for next October 2.
The Government offered on Thursday a 5.8% increase for teaching and non-teaching staff, although the unions rejected the official proposal, since they ask the Executive that does not repeal the norm voted in Congress because it exceeds only salaries, but also declares the budgetary emergency of the university system and establishes the budget inflation update retroactive to December 1 of last year.
“The proposal is very far from being on par with the state ones because it is only 5.8% for October and it does not recognize the enormous debt of more than 50 nominal points in the salary of teachers and non-teachers. It also does not resolve the issue of the salary guarantee , FONID and other topics,” said the general secretary of CONADU, Carlos De Feo.
Javier Milei celebrated the salary increase
President Javier Milei celebrated ”REAL WAGE IS UP AGAIN”citing the INDEC post on the social network X (formerly Twitter). Although average salaries rose above inflation in July.
The Ministry of Economy also highlighted the increase in salaries and added: ”The fiscal and monetary order, through the reduction in inflation and the improvement in expectations, is the basis of salary recovery. “In this way, four months in a row have been recorded with a nominal increase in wages above inflation.”
Labor reform
The Government regulated the labor reform included in the law bases. On this point in particular, Chiesa classified it as “an antics” and pointed out that “it is not going to generate even one job because it has nothing to do with generating genuine employment.”
“We have had 6 million private employees for 20 years and we are going to stay that way for many more years or until a tax reform is carried out and the 300,000 employers who generate 90% of the country’s employment are removed.” , added the lawyer.
Source: Ambito
