Salaries beat inflation: they rose 4.7% in September, but slowed their recovery

The salaries rose 4.7% in September and they beat inflation, which in that month was 3.5%. However, in the year-on-year measurement (ai) they continue to lose compared to the Consumer Price Index (CPI)since salaries increased 181.9%, while the price variation was 209%, with which they exhibit a real loss of 8.8% in the last year.

So far in 2024, the average earnings have risen by 119.2% in the face of a price advance 101.6% in the same period, as reported by the National Institute of Statistics and Censuses (INDEC).

The economist Pablo Ferrari pointed to Scope that “There is a slowdown in salary recovery”. And since February, the recorded wages began to beat inflation, with the exception of March when they lost, the September index is the one that shows the least monthly improvement, in the order of 0.34%.

Salaries during Javier Milei’s government: did they win or lose?

The average monthly growth in September is due to increases in 3.8% in the registered private sector, 3.9% in the public sector and 10.4% in the unregistered private sectoraccording to the INDEC.

In year-on-year terms, the increase in wage index was a consequence of the increases in 197.7% in it registered private sectorof the 149.7% in it public, and of 191.8% in it private unregistered. In this way, the public segment was already below the unregistered segment in the salary increase.

Since the assumption of Javier Milei to the government, the registered private sector accumulates a drop in purchasing power of 1.5%, while the public sector shows an even greater loss, of 16.1%. On average, among those registered, the decrease in salaries is 6.8%.

Informal wage earners, for their part, would show an improvement in 1.5% and the average of registered and unregistered assets shows a decrease of 5.7% compared to November 2023.

“The public employee is the one who is losing the most purchasing power in these months”noted the economist Nadin Argañaraz. In the month of September he had a real income equivalent to 84% of what he had in November 2023, that is, he lost 16% of real income compared to that month, according to his calculations, although the biggest drop was in February when lost 22%.

Unrecorded salaries: why they go up by elevator, while others go up by stairs

“It is difficult to understand that the registered private salary has not recovered more than or equal to the non-registered private salary”Ferrari mentioned. The thing is, Since May, unregistered salaries have been rising above registered private salaries and already in the accumulated variation of 2024 they surpassed them: 138.5% recovered from a 124.3%.

In that sense, Martin Carroeconomist and professor National University of Avellaneda (UNDAV)explained that the unregistered salary data that currently appears has a “lag” of more or less five months, since it is taken from the Permanent Household Survey (EPH), for this reason, it is that “Salaries did not grow so much now, nor did they lose so much in December”. The first month in which a double-digit increase is observed is in May, which would actually correspond to December, according to the specialist.

“To see the variation of the unregistered, what you can do is observe the rise in the Minimum Vital and Mobile Wage (SMVM)which rose 21% between May and September,” Carro highlighted.

“Surely the variation in the salary of those not registered is more similar to that variation and not to the 71% reported by the index since it is 5 months behind. In fact, the SMVM in the 5 months prior to May moved 60% , more similar to that 71% reported by the index,” analyzed the economist.