In October, inflation beat wages again and purchasing power fell by 4.9% in ten months

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In all comparisons, the wages of regular workers have been declining relative to inflation. Despite the compensation renewals, the wages of workers with social security contributions increased by 5.5% in October. below that month’s inflation, which was 6.3%.

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So, in the first 10 months of this year, formal employee pay accrues a 70% increase against 76.6% inflation.

Compared to a year ago, wages were up 78.8% and inflation was 88.0%. This equates to a loss of 4.9%.

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The salary figure is official and corresponds to the RIPTE (Taxable Salary for Stable Workers), the monthly series of which began in July 1994.

The RIPTE is calculated on the basis of average salary subject to contributions to the Argentine Integrated Pension System (SIPA) received by workers with an employment relationship and which have been declared continuously in the last 13 months.

From October, gross wages (without discounts) with contributions an average of $174,436.90, according to official data based on the amounts declared by companies to the Social Security. A year ago it was $97,538.78 Since it is the gross salary that determines out-of-pocket income, at $174,436.90 the worker’s pension and health care contribution should be discounted (17%) and possibly add the family salary per child

According to the Government, registered wages “lost 21.6% of their real value between December 2015 and December 2019”. Compared to the salary cap, reached at the end of 2017, the drop is 24%.

Then in 2020/2021, with ups and downs, end to end, the formal salary accompanied inflation, but with interim losses and there was no recovery compared to the end of 2019, as had been an official promise. And so far this year, a further loss of 4.9% was recorded.

Overall, employees with ANSeS contributions amount to approximately 7.5 million, approximately 75% of the almost 10 million employees registered. The rest goes to provincial savings banks or other schemes.

These 10 million, in turn, account for half of all formal and informal jobs in the country (single tax payers, self-employed, wage earners without pension discounts, and informal self-employed).

As a wage index, the RIPTE is used every three months (March, June, September, December) to fix half the mobility rate of pensions, pensions and other social benefits and for calculating compensation for occupational injuries.

It is also used to update the file once a year Minimum non-taxable income tax. And the salary floor of the tax.

It is also used to update once a year the family income ceiling for collecting child benefits, a ceiling which is very outdated and is leading more and more workers to lose the collection of family salary for son or daughter. And every month the share that employers pay into the Sickness Fund for COVID insurance increases.

Source: Clarin

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