Salary increase: Decree with percentages lower than those required by the COB will not have an impact on employment

If a salary reinstatement decree is promulgated with percentages lower than those demanded by the COB leadership, in the opinion of the investigator
employment Bruno Rojas, will not have a significant effect on employment, since
be negative with layoffs, unemployment and adjustments in the payroll; or
positive, as long as it contributes to the generation of new jobs.

He insinuated that the dismissals and personnel adjustments already occurred in the period
critical of the pandemic, so a greater adjustment of employment under the pretext
of the replacement measure, could cause social instability and complicate
the critical labor situation in the country.

For Rojas, the demand for an ‘increase’ from the COB, such as what the Government decides, is a partial salary replacement, given that the so-called ‘increase’ occurs a year after salaries lost their purchasing power
and because the national minimum and average wages paid today are low and precarious. “In 2019, before the pandemic, 91% of the urban employed population had precarious jobs and 62% had the worst jobs; one of the indicators of this high level of precariousness was precisely low wages and labor income”, he noted.

He explained that the country entered since last year in a process of recovering lost jobs (more than 477,000 in 2020 in the pandemic), which is expressed, according to official data, in a decrease in the urban unemployment rate until the end of the 2021 (5.2%); which is why it would be
counterproductive for the country’s economy and for the businessmen who
reinstatement measure is a pretext to fire workers and influence
in a rise in unemployment.

From the perspective of the workers, in the opinion of the researcher, a
partial replacement of their salaries has a positive effect, because it alleviates the
loss of the purchasing power of their income which, in recent years, has fallen steadily since 2018.

In the current context, according to the economist Róger Banegas, it would not be
pertinent to force wage increases. “The real minimum wage is at levels above the market, especially for activities with less training and technical ability, which is actually a detriment rather than a benefit,” he argued.

For the basic salary, he expressed that there is a situation of economic rebound statistics and a level of economic activity prior to the pandemic has not yet been reached.

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If a salary reinstatement decree is promulgated with percentages lower than those demanded by the COB leadership, in the opinion of the investigator
employment Bruno Rojas, will not have a significant effect on employment, since
be negative with layoffs, unemployment and adjustments in the payroll; or
positive, as long as it contributes to the generation of new jobs.

He insinuated that the dismissals and personnel adjustments already occurred in the period
critical of the pandemic, so a greater adjustment of employment under the pretext
of the replacement measure, could cause social instability and complicate
the critical labor situation in the country.

For Rojas, the demand for an ‘increase’ from the COB, such as what the Government decides, is a partial salary replacement, given that the so-called ‘increase’ occurs a year after salaries lost their purchasing power
and because the national minimum and average wages paid today are low and precarious. “In 2019, before the pandemic, 91% of the urban employed population had precarious jobs and 62% had the worst jobs; one of the indicators of this high level of precariousness was precisely low wages and labor income”, he noted.

He explained that the country entered since last year in a process of recovering lost jobs (more than 477,000 in 2020 in the pandemic), which is expressed, according to official data, in a decrease in the urban unemployment rate until the end of the 2021 (5.2%); which is why it would be
counterproductive for the country’s economy and for the businessmen who
reinstatement measure is a pretext to fire workers and influence
in a rise in unemployment.

From the perspective of the workers, in the opinion of the researcher, a
partial replacement of their salaries has a positive effect, because it alleviates the
loss of the purchasing power of their income which, in recent years, has fallen steadily since 2018.

In the current context, according to the economist Róger Banegas, it would not be
pertinent to force wage increases. “The real minimum wage is at levels above the market, especially for activities with less training and technical ability, which is actually a detriment rather than a benefit,” he argued.

For the basic salary, he expressed that there is a situation of economic rebound statistics and a level of economic activity prior to the pandemic has not yet been reached.

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