Annabella quiroga
01/04/2021 10:30
Clarín.com
Economy
Updated 01/04/2021 10:30
In 2021, the real wage would fall again, according to economists' projections.
It would be the
fourth consecutive year
in which workers' incomes have lost to inflation.
Between 2018 and 2020, purchasing power fell 25%.
And this year it would drop by about 3%, as long as there is no unforeseen jump in the dollar or the price index, which would further deepen the decline.
The government predicts that inflation will continue to fall this year and will end at 29% and it sticks to that calculation to insist that wages will recover.
But private analysts place the price index much higher, with
45% as a floor.
Matías Rajnerman, from the consulting firm Ecolatina, predicts that inflation will be 10 percentage points above the end of 2020, estimated at 36%.
"
I do not see a recovery in real wages.
It will be the fourth year of decline," he predicts.
The baseline scenario used by the economist is based on an advance in vaccination that avoids returning to a rigid quarantine that impacts even more on activity.
Between 2018 and 2020,
the real wage loss reached 25%
, according to Rajnerman's estimate.
"A quarter of the salary was lost. It is the deepest drop since the crisis of 1998/2002."
"The salary loss between October 2001 and December 2002 was 23.5%. In that crisis the adjustment was all for jobs, but those who kept their jobs did not lose as much. On the other hand
, wages are frozen today
, which it causes unemployment to rise less, while real wages fall much more. This generates the effect of the
monetary illusion:
one feels that they charge more but it reaches less. This is a heterogeneous crisis. In these three years it was inflation that destroyed wages. So now everyone loses and curiously
there is less social conflict than in 2001
".
Rajnerman stresses that "it is not only inflation that hits wages, but unforeseen inflation. That was the problem in 2018/2019, we ended up losing a lot because
the parity adjustments did not incorporate a rise in the dollar."
For this year, the economist points out that if there is no second wave of Covid "in the end-to-end measurement of wages, there may be a recovery, especially of registered private workers."
The consulting firm LCG calculates that in 2020, in the formal sector, "wages were the adjustment variable in the labor market, reflecting a real fall of 1.6%."
At this point, State assistance through the Work and Production Assistance program (ATP) "moderated the fall in formal employment, resulting in a much lower magnitude than in the informal sector of the economy."
So, in the informal sector "the adjustment came from both sides:
wages average a real drop of 8%
and employment a 23% drop, analyzing the first 9 months of 2020 compared to the same months of 2019."
On the other hand, in the public sector, without adjustment of quantities, "the dynamics was similar to that of the private sector, but with a greater fall in real wages, of 6.1%".
"
Looking ahead to 2021, the anchor that was wages this year can hardly be maintained
, at least by the same magnitude," says LCG.
For the consultancy, the purchasing power accumulates a decrease of 21% compared to the end of 2017. "Perhaps the most that the Government can hope for is that the unions take the argument of looking at past inflation concentrating exclusively on what happened in 2020 and leaving aside possible adjustments that take into account future inflation. "
LCG estimates an inflation of 55% for this year.
"The most likely scenario is that of a fall in real wages for the fourth consecutive year
, even though the recompositions via parity give some monetary illusion. In fact, we expect that the income of workers (public and private, formal and informal, salaried and independent )
will average a real drop of 3% in 2021 "
.
For this year, together with an inflation with 45% of the floor,
a rebound of the economy of between 5 and 6% is expected.
But that growth will not be enough to recover real wages or to return to pre-Covid levels.
Andrés Borenstein, from EconViews, points out that if the economy grows 6% in 2021 it will end five points below 2019. All this collapse reinforces the loss of purchasing power.
"Being optimistic
in 2025 the average Argentine will be 15% poorer than it was in 2011
", Borenstein slides.
For this year, he anticipates that salaries "will surely fall more in the first part of 2021 due to higher inflation and then they will rise as the legislative elections approach."
From the consultant Wise they provide a slight hope.
"There is a key issue: after three years of losses in real terms, we smell that in 2021 wages, even if it is,
are going to tie to inflation or lose narrowly
."
AQ
Look also
Salaries 2021: how much do companies plan to increase to non-contract employees
State aid barely moderated the sharp drop in family income