The Council on Minimum, Living and Mobile Wages meets this Tuesday, after which between November 2022 – the month of the last meeting and increase of that Council – and March the minimum wage has a real reduction of more than 5%.
“That is to say that the meeting of this Council, called for March 21st we will start from an extremely low threshold in the value of the minimum wage”, according to CIFRA (Research and Training Center of the Argentine Republic). Compared to 2015, the accumulated loss exceeds 33%.
A 20% increase in 4 tranches was set in November 2022 which brought the SMVM to $69,500 in March. Discounting 7% inflation for this month, the average price increase from November to March would be about 27%.
AS, the latest increase in November proved to be short-lived and this month the SMVM is 5.5% below its November level.
In relation to the food basket and basic poverty, the decline, compared to November, is much higher since it would exceed 10%.
The CIFRA Report underlines this “the purchasing power of the minimum, living and mobile wages shows a negative trend since 2011, which has been particularly strong in the last two years of Mauricio Macri’s government and in 2020. This decline was even greater than the real loss in recorded wages”.
Then, “between 2021 and 2022, in a context of growing inflation, there were seven cases of updating the minimum wage, which failed to recover their purchasing power. The year 2022 closed with an average drop in the real minimum wage of 1.3%which placed it 33% below the 2015 level”.
The Employment Contract Act assigns three characteristics to the minimum, living and mobile wages. It is the lowest wage that the worker without family responsibilities must receive in cash for his working day. It must guarantee adequate food, decent housing, education, clothing, health care, transport, recreation, holidays and social security coverage. And it needs to be adjusted periodically based on changes in the cost of living.
It is more than evident that at $347.50 per hour or $69,500 gross, plus any collection of family wages per child, it’s impossible to cover all of the requirements set forth in the employment contract law when the basket of poverty for a typical family this month is about $190,000, without calculating rent. Therefore, the SMVM is not minimal, it is not vital or floating in relation to the price increase.
The minimum wage has an impact on “Potenciar Trabajo” programs. (over a million people) earning half the minimum wage e “Accompany” (35,000 people) women and LBGTI+ in situations of gender-based violence receiving a minimum wage for 6 consecutive months.
It also affects registered monthly or day workers who earn less than the monthly or hourly minimum wage. And indirectly as a reference to unregistered or informal workers.
It also affects the non-foreclosure wage share which equals the minimum wage amount, except for alimony debts. From this value, an increasing percentage is applied to the difference between the salary received and the SMVM.
Furthermore, it adjusts the minimum pension of those who retired with 30 years or more of contributions without resorting to moratoriums. In these cases it must be equal to 82% of the SMVM.
For its part, since February 2023, the value of the private medicine quota is limited to 90% of the RIPTE of the immediately preceding month and is applied to prepaid plan holders who have a net income of less than 6 SMVM.
NS
Source: Clarin
