With annual inflation rising to 104.3% and wages growing below that level, the deterioration in purchasing power -in general- is more than evident. However, the impact of the price increase is uneven depending on the observations observed in each product.
Taking into account about 10 basic products in the basketover the past year, the average salary of a formal worker, authorized to purchase plus meat, bread, grass, and some cleaning and personal hygiene products. But less volume than the others, such as oil, milk, sugar and eggs.
It happens that the average salary, according to the RIPTE index (Average taxable remuneration of stable workers) by the Ministry of Labour, went from $121,220.45 in March 2022 to $239,882.73 in the same month this yearthat is, had a change of 97.89%while several products in the basket increased their prices above that level and others appreciated below that level.
The most emblematic case is that of meat. Different cuts such as roasts or ground beef rose in that period, for example, by 82.18% and 87.09%, respectively, according to the INDEC Consumer Price Index (CPI).
With beef, it happened that in all of 2022, while annual inflation had been 94.8%, meat only increased by 42.4%, according to the IPCVA. It then started to recover with fresh increases and in March of this year it amassed an 86.5% upside, still below inflation on an annual basis.
The same didn’t happen with chicken, whose price per kilo rose from $276.59 to $612.50 in the past year. With which, wage performance worsened by more than 30% for purchasing that food.
According to official data, the average salary is also allowed buy 4% more French bread; 12.26% more grass and more units of deodorant (2.83%) and detergent (7.71%)by chance.
On the other hand, the same salary which, in 2022, allowed the worker to buy 391 1.5 liter bottles of sunflower oil, in March of this year, allowed him to buy 270. And the 1,114 liters of fresh milk in sachets available in March of this 2022, they have become 952 units, based on the purchasing power of the current salary.
In April, after the recent devaluation of the peso against the dollar, product prices continued to rise. According to the analyst Damián Di Pace of the consultancy firm Focus Market, “there were in the gondolas increases between 7% and 15% by category in the last 15 days” of that month.
“All categories of mass consumption travel in triple digits of interannual inflation compared to April 2022. Beverages are up 108%, housekeeping is up 116% and personal care is up 125.6% on average,” he explained the analyst.
According to the INDEC price survey, products that have risen above the wage level also include asugar, with an annual increase of 198.20% and eggs (152.84%). A year ago the average salary allowed you to buy 497 dozen compared to the current 389.
Taking into account the general behavior of income with respect to inflation, in 2022, wages increased, 4.4 points less than inflation, according to official data. Thus, while wages increased by 90.4%, inflation increased by 94.8%. The only sector that managed to beat inflation was that of civil servants, who received salaries that exceeded the price increase.
Although the wage level has improved towards February this year, it accumulates a loss when compared year on year. And, according to the consultancy firm Economia&Regiones, “the acceleration of inflation in March (7.7%) would leave the biggest erosion of workers’ real wages,” he said in his latest report.
For LCG Consulting, inflation installed at a minimum of 7% per month implies a loss of almost 20% of purchasing power in just three months.
“Sooner or later the wage discussions will come back into focus, threatening to fuel repricing in a historically never-ending supply. Furthermore, as long as these readjustments are delayed, consumption will start to suffer, weakening the last shown pull factor from the economy in the midst of an inflationary crisis,” warned the adviser.
Source: Clarin
