Although inflation is the most popular thermometer in the discussion of the minimum wage every year, at the negotiation table there is another factor that weighs on the bid between unions and businessmen: the productivity figure.
Today the Dane will deliver, within the framework of the meeting of the Productivity Subcommittee, the preliminary data of the indicator, and the perspectives that the experts have is that it is similar to that of the previous year.
(Read: Fedesarrollo uncovers its cards: it proposes to increase the minimum by 13.5%).
The economist and former director of Dane, Juan Daniel, explained that the factor productivity data summarizes the contribution of “how good it is” lThe mix of inputs for the generation of profits in the Colombian economy in 2022.
“It is wanted to see, beyond the individual contributions of the hours worked and the different types of capital, known by the recent figures of labor market and national accounts; how their combination made us grow faster, or on the contrary, slowed us down”Oviedo explained.
According to the economist, the estimate of the contribution of factor productivity to the growth of the economy in 2022 could be in a range between 0.35 and 0.57 percentage pointsaccording to the combination of its factors.
According to the expert, on the work side, there are several factors to take into account, such as the fact that the average hours worked per week by the employed, they grew an average of 7.3 percentage points in the first nine months of the year, compared to 2021. And also, he assured that “the labor market shows signs in volume that partially resemble those of 2019.” Therefore, he assured that this factor could contribute around 0.43 percentage points to the total.
“On the other hand, the levels of gross fixed capital formation for the first nine months of 2022 correspond to a level obtained from a successive annual contraction from its value in the same period of 2019, at an annual rate of -2.2%. This translates into a contribution of capital services even lower than in 2019 (for example, 1.12 points in 2018) and perhaps very close to one, below theor”, estimated Oviedo.
(Also: Anif’s proposal for the 2023 minimum wage discussion).
On the other hand, Oriana Álvarez, executive director of Fundesarrollo, the economic studies center of Barranquilla, maintained that the total productivity of the economy “will be very close to the level reached in 2021” which, he indicated, “is worrying considering that the increase in the hours worked by workers in Colombia has already fully recovered (42 hours a week on average), a figure much higher than the hours of 2020 ( 39 hours)”.
The foregoing, according to the expert, would be determined mainly by the high rates of informality that make it difficult to determine with certainty the contribution that this labor force makes to the country’s productivity.
Although the total productivity of the factors will be key in the discussion, its measurement criteria, and especially its relationship with labor productivity ccontinue to be the subject of debate. Even, as Iván Jaramillo, a researcher at the Labor Observatory of the Universidad del Rosario, stated, it is possible that the discussion has other foci.
“What the law says is that productivity should be agreed upon in the tripartite commission. I think that this year it is very possible that they will begin to migrate towards the simply labor productivity indicator for setting the minimum wage, because general productivity sometimes even gives negative results, and that has been widely criticized by the unions”, he assured.
But one point that all the experts make is that productivity in 2021 will be positivewhich would put more pressure on the bid for the minimum wage.
“We hope that the productivity data will be quite positive for the country, since despite being a quite complicated year due to high prices (which increase production costs) and inflation that is above 12% (which stimulates consumption)”, said Luis Gonzalo Gómez Guerrero, director of the Municipal Institute of Employment and Business Development of Bucaramanga (Imebu).
(Keep reading: These are the sectors and the best paid positions in Colombia 2022-2023).
According to Gómez, this would tell us that our businessmen were able to effectively overcome and circumvent these difficulties and be even more competitive despite them.
Relationship with company performance
productivity itself is a reflection of the economyand from the firm Baker McKenzie, María Cecilia Reyes, associate of the Labor and Compensation practice group, highlighted that “indicators such as productivity and even inflation, in a normal state or close to normal levels, should be a signal for the investors of an improvement in the economy, greater political security and even legal certainty (in contractual matters)”.
According to the expert, the productivity data, as well as other indicators and, in general, the recovery movements of the economy “will be affected in the short term by the effects of the tax reform and government projects”, such as the reform labor. In contrast, Gómez indicated that the fact that our total factor productivity is positive can also be translated in better wages with a view to the discussion that will take place regarding the minimum wage.
Laura Lucia Becerra Elejalde
