Due to increases resulting from the parity negotiations, in May the wages of workers and registered employees tied inflation, but dragged in the last 12 months a loss of 11.3%. Compared to December 2015, the loss is greater, 16.3%. So far in 2019, wages and inflation have advanced at the same pace.
In May, official data indicate that registered wages increased by 3.2%, according to the RIPTE (Taxable Remuneration of Stable Workers) prepared by the Ministry of Health and Development on the basis of registered company wages. It is just 0.1 point higher than the average inflation for that month, which was 3.1%, according to INDEC records.
On average, the gross salary recorded with retirement contributions for that month was $40,911.09. A year ago, it was $29,338.79. This represents an increase of 39.4%. In those 12 months, inflation was 57.3%. This means a loss of purchasing power of salaries of 11.3%. In relation to the total basic basket, which amounted to 61.1%, the loss is higher.
Since these are gross salaries, retirement and health contributions must be deducted (17%), which reduces the net salary in May from $40,911.09 to $33,956.20.
The greater the fall if the comparison is extended to December 2015. Then the average salary was $15,800.97. It is an increase of 158.9% versus an inflation of 209.4%. It represents a fall in real terms of 16.3% compared to the beginning of the current administration.
What happened is that in 2016 inflation was 40.9% and salaries increased 30.9%. They are 10 points less. In 2017, there was a small salary recovery because salaries rose 27.1% and inflation was 24.8. Last year, against an inflation rate of 47.6%, salaries increased by 30.6%. That’s 17 points less.
This year, to reduce this wage loss, salaries should increase well above 40%, taking into account that the IMF and private consultants forecast that percentage of peak inflation for this year.
All these values, together with the fall in pensions and social benefits and self-employed workers explain the fall in consumption, as reported on Tuesday by INDEC based on sales numbers of supermarkets, self-service wholesalers and shoppings.