“Labour inflation” was 6.3% in February and exceeded 100% last year

“Labour inflation” stood at 6.3% in February, accelerating by 0.8 percentage point compared to January. Thus, the interannual evolution of prices crossed three figures for the first time since the end of the hyperinflations of 1989-90, and was situated in 101.8%”, according to the measure of the Institute of Labor Statistics (ETI) of the Metropolitan University of Education and Labor (UMET) and the Center for Consultation and Development (CCD).

Note also the fact that during the first two months of the year, prices have accumulated a rise of 12.1%. “If this increase were to continue throughout 2023, it would be compatible with cumulative inflation of 98.9%,” said the specialists who prepared the report.

Inflation in the second month of the year was driven by the rise in “education”which climbed 16%, coinciding with the start of the school year which is usually accompanied by quota adjustments in private schools and increases in supplies.

Second, the increase in “health” (+6.9%), highlighting increases in prepaid (+8%). At the third order, the food they increased by 6.5%, driven by meat (+8.9%), fruit (+9.7%) and infusions (+9.9%).

It was followed in descending order of the category of “dwelling place” (+6.4%), which is also progressing above the average, driven by rents, charges and the rise in electricity.

Below the general level are “communication “ (+6.2%) and “transportation” (+5.9%, driven by zero kilometer vehicles, gasoline and lubricants). Also included in this group are articles by “House equipment” (+5.6%), “other goods and services” (+5.4%) y “leisure and culture” (+5%).

Only the title of “clothes and shoes” (+3.4%) fell below the 5% mark, which shows that inflation has spread to the various items and with an inertia that is difficult to curb.

From Metropolitan University for Education and Labor detail that, despite the economic plateau of recent months (indeed, the economy ended 2022 year-on-year in December), registered private wage employment continues to grow, albeit at a slower pace than in the first half of 2022.

Indeed, official statistics show that in December (latest month available) 14,000 new salaried jobs were created in the registered private sector compared to the previous month. Thus, employment has been recovering for 29 consecutive months, which had not been observed since the end of the international crisis of 2009 (end of 2009 to end of 2011).

During the year 2022, 263,000 registered salaried jobs were created in the private sector, which marks an increase of 4.4%, well above population growth (1%). Compared to the end of 2019, 272,000 registered private salaried jobs have been created and nearly 481,000 against the pandemic floor.

“Despite this recovery, the levels of April 2018 have not yet been reached, when there were 4,000 more registered private jobs than currently, with a population almost 5% smaller,” the experts said.

Regarding the median real wage in the registered private sector, the latest data available for December shows a considerable monthly recovery, which led it to be 3.5% above December 2019 and the highest level since March 2020.

The non-remunerative allowance of $24,000 established by the national government, the parity renegotiations (according to the Ministry of Labourthe average wage increase in 2022 in the main collective agreements ended up being 104%, higher than observed inflation) and a certain moderation in inflation in the last months of 2022 explain this performance.

However, the salary is 11.8% below February 2018, before the start of the currency crisis of that year.

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