The minimum, vital and mobile wage (SMVM) fell 1.3% in October and between November 2023 and October it accumulates a loss of 28%. The sharp drop is explained as a consequence of the increase in inflation, with a peak of 25.5% in December after the devaluation, and the increase in rates, according to a study prepared by the Interdisciplinary Institute of Political Economy of the Faculty of Economic Sciences of the UBA.
The report titled “Panorama of formal salaried employment and remuneration” shows that the decline in the SMVM began in December 2023, when it contracted 15% due to the inflationary acceleration and deepened even further in January with a fall of 17%.
This trend was momentarily interrupted in the following months, a period during which the nominal increase accompanied inflation, so no additional reductions were observed. In the month of June there was a new fall (-4.4%), followed by some recovery in July (4.3%) and for consecutive reductions in the following three months.
The decreasing trend of previous years, in addition to the strong contraction of these months, placed the minimum wage at a value lower than that registered in 2001, prior to the convertibility crisis.. Likewise, this implies an erosion of almost 60% compared to the maximum value of the series, in September 2011.
Formal salaries still do not equal the purchasing power of November 2023
He average salary of formal workerswhich measures the National Institute of Statistics and Censuses (INDEC)also recorded a sharp contraction between November and December of last year. Although, with the inflation slowdownadded to the salary negotiations within the framework of the joint agreements, allowed, first, to prevent the decline in the purchasing power of assets from continuing and, then, to begin a recovery process.
In the month of August, this index registered an increase of 0.8%, and 0.3% in September. Despite this, as of September 2024 (latest data available) The purchasing power of average salaries continued to be 1.5% lower than the November value. However, the percentage increase attenuated markedly since August.
The outlook for the months of August and September is more critical when the average remuneration figures for registered private sector employees from the SIPA are analyzed. After growing in real terms in the month of June (+4%) and July (+2.8%), in August it experienced a drop of 2.5% and in September, the preliminary data released by the Ministry of Labor gives account of a new drop, of 1%.
This implies a loss of purchasing power of 3% below the record of November 2023. At the same time, it accumulated a drop of around 20% compared to the maximum of the series recorded in May 2013.
Source: Ambito
