According to the report on wages corresponding to the second quarter of 2022, prepared by the Cuesta Duarte Institute, the official information available regarding the evolution of real wages shows “clearly the contrast between a growing economy, with an expansion of the Gross Domestic Product (GDP ) of 4.4% in 2021 and a projection of 4.8% for this year, and the downward trajectory of the purchasing power of wages as well as the delay in the recovery process”.
In this way, “today the Uruguayan economy is capable of generating greater wealth than in 2019, but the real wage bill has not only not grown in the same proportion, but has also decreased in absolute terms, causing a substantial worsening in the distribution between labor and capital”, is indicated in the report.
The study indicates that the salary adjustments implemented in July 2021 and January 2022 (beyond the fact that some sectors of activity may have had salary increases in other months) “have been insufficient not only to develop the beginning of the recovery as it had been compromised but to maintain the purchasing power of wages.”
The Institute affirms that during this mobile year, the average real salary had a decrease of 1.6%. Thus, “the real wage level for June 2022 is the lowest in the entire series counting from January 2020.”
28 month loss
The deterioration of the purchasing power of wages “It has already been accumulating for 28 months, compared to a 2019 average real wage benchmark.”
“Even in the optimistic scenario that as of the next few months the average real wage effectively begins a growing trajectory and that in 2024 or 2025 it reaches the level it had before the pandemic, we will also have witnessed a period of at least four years of accumulated loss of economic well-being of salaried workers”, it is expressed.
As an example, “a worker who in 2019 earned 35,000 pesos per month and his remuneration followed the trajectory of the Average Salary Index between March 2020 and June 2022, had a loss in real terms of approximately 1,240 pesos per month.”
In this way, a loss equivalent to a full monthly salary is accumulated in the 28 months.