According to Libertad y Progreso, the purchasing power of wages fell 42.5% in nine years.

NUEVAS PALABRAS: The purchasing power of private wages fell by 1.9% in July when compared to the Total Basic Food Basket (CBT) the same month, which serves as the limit of poverty and accumulates a drop of 42.5% in the last nine years, according to the measurement released today by the Fundación Libertad y Progreso.

The of the INVT (Workers’ Living Standard Index) in July was the second largest in the entire Administration of President Alberto Fernández, after that which occurred in 2020, at the beginning of the pandemic and the Preventive and Mandatory Social Isolation.

With this, the Index reversed the recovery of the second half of 2021 and returned to the levels it had in December 2019, the month of the inauguration of President Alberto Fernández.” Since its peak in September 2013, the maximum of the series and also the historical maximum, the Index fell 42.5%».

In other words, in a decade the purchasing power of private wages practically fell by half,” the foundation stressed

Eugenio Marí, Libertad y Progreso’s Chief Economist, stated that the acceleration of inflation in 2022 hit the purchasing power of wages hard, especially in terms of access to the basic food basket. Hence, we are seeing a generalized process of reopening wage negotiations.”

Marí added that “however, the real problem is that the Argentine economy has not grown for more than a decade. We often hear that this is a crisis of growth, but if reforms are not applied to recover investment and innovation, then we will not see a change in the trend in the standard of living of workers”.

Executive director Aldo Abram, considered that “the inflationary tax with which the Central Bank finances excess State spending is regressive; since, in proportion, it takes more from those who have less, impoverishing them even more.

Let’s imagine a businessman who sets up a factory and hires us to run a state-of-the-art machine. Since we produce a lot, we have a high income. However, governments begin to squeeze the factory owner with taxes and overwhelm him with absurd regulations; so, tired, he will stop investing. Our machine will get older and older and start to be ‘tied up with wires’; so it will produce less”.

For the economist, “this will imply that we will begin to see our salary drop; because they cannot pay us more than what we produce or the company would go bankrupt and we would all be left without income. That is what is happening to Argentines and, for this reason, we see how we are getting poorer with the passage of time”.