According to recent data, the loss of purchasing power in certain sectors is estimated to reach approximately 27.8% compared to August 2023. Fiorentin, an economics expert, highlighted the challenges of maintaining the wage mass amidst job destruction. She stated that although real wages recover, there are fewer people with income due to inflation and adjustment policies.
In August 2024, wages showed an average increase of 5.7%, exceeding the inflation index of 4.2% for that month. In comparison, the registered private sector experienced a lesser real loss, while the unregistered private sector suffered a significant setback against the rising cost of living.
MartÃn Vauthier, an economist, mentioned that wages in Argentina have increased by 7.4% so far in 2024, with a nominal increase of 109.3% compared to the price rise. For the coming months, wages are expected to continue rising if inflation continues to decelerate.
Although the projected wage adjustments for October are expected to average 3.9% monthly, with expected inflation below 3.5%, moderate relief is anticipated for workers. However, on an annual basis, labor income still shows a decrease relative to the price increase.
According to the latest INDEC report, the sectors that drove wage increases in August were the registered private sector (5%), the public sector (4.7%), and the unregistered private sector (10.6%). Despite these advances, annual data reflects a loss of 36.1 percentage points in real terms compared to the previous year.
Specialists point out that the public sector is the most affected, with wages increasing by 166.6% annually, falling behind inflation by 70.1 percentage points. Although real wage growth has been recorded for the fifth consecutive month, this advance is considered fragile.
Javier Milei, the president, celebrated the increase in real wages; however, it is noted that part of this improvement is allocated to covering fixed costs such as utilities, impacting consumption. According to Lucas Romero, a political scientist, the recovery of purchasing power is not complete, as consumption still shows signs of retraction.
CEPA analysis suggests that wages in the unregistered private sector may have limited nominal increases due to their close relationship with the Essential Minimum Wage, which only increased by 3.2% in August.
