Economic plan has drained salaries more than official data shows

Wages in both Argentina's public and private sectors have suffered significant declines since President Javier Milei assumed office, according to data from the Center for Research and Training of the Argentine Republic (CIFRA). Official figures indicate a 8.2% wage drop since November 2023, with a 1.1% recovery over the past three months.

However, CIFRA researchers argue that the real loss is closer to 13% when using the inflation measurement methodology that the statistics bureau INDEC was set to adopt earlier this year but was later rejected by the economic team. CIFRA's alternative consumer price index (IPC) reveals an 8.5% decline in private-sector wages and a 20.8% decrease in public-sector wages.

The researchers note that this is a "very meager result." The controversy surrounding the IPC is related to the use of an outdated 2004 framework for weighting goods and services, which no longer reflects Argentines' consumption habits. The previous plan to implement a new methodology based on the National Household Expenditure Survey conducted between 2017 and 2018 was delayed due to the disinflationary process.

Public-sector wages have been hit hardest, with CIFRA confirming a 40.2% loss in national public-sector wages since December 2023 and a 14.3% loss for provincial public-sector wages. Similarly, real collectively bargained wages have experienced a "process of deterioration in purchasing power" over the past year and a half. The decline in minimum wage has been particularly severe, with CIFRA estimating a 41% drop based on the alternative IPC, leaving it 60% lower than in 2015 and 20% below 1990s levels.