Formal worker has been without real salary gain for three years, says survey – 01/26/2022 – Market

The combination of high unemployment, lukewarm economic activity and skyrocketing inflation made the conditions for salary readjustment negotiations worse in 2021. Last year, formal workers completed three years without real gain, when the increase exceeds the inflation of the previous period, according to the Salariómetro bulletin released this Wednesday (26) by Fipe (Fundação Instituto de Pesquisas Econômicas).

The median change in 2021 was negative by 0.1% — in the previous two years, it was zero. The median is a form of calculation adopted to avoid distortions with the inclusion of very high or very low values, which occurs in the calculation of averages, for example. Then use the highest value among the smallest, and the smallest among the largest.

For the Salariometer coordinator, Professor Hélio Zylberstajn, from the Faculty of Economics, Administration and Accounting at USP, the 2021 result could have been even worse given the conditions of the economy and the job market.

“In other years, inflation was lower, but in 2021 it was brutal. Taking that into account, it wasn’t as bad as it could have been”, he says.

On average last year, only 18.6% of the agreements and conventions signed resulted in increases greater than the inflation of the 12 months prior to the base date. In 2019, the last year of the pre-pandemic, almost half of the negotiations ended with real gain for workers.

​In addition to the low readjustments, the Salariómetro also recorded an increase in agreements and conventions that provided for the staggered payment of readjustment rates. “This almost didn’t appear before the pandemic and it jumps at times, depending on the number of categories that closed negotiation. The readjustment is small and is still paid in installments”, he says.

Zylberstajn also highlights the adoption of ceilings for the application of readjustments. This can be used both to define a salary range to be corrected, when the increase is only applied to a portion of the salary, and to limit who will be entitled to the adjustment.

The negotiations closed in December provided for this mechanism in 16.4% of the cases. In November, the ceiling was at 36.5% of deals; and in September, 27.7%.

The staggering of readjustments, the ceiling for applying the increase and the indices that barely compensate for the deterioration of purchasing power are indicative of more tense negotiations between employers and employees, says the Fipe researcher.

“More complicated because companies cannot pass this level of inflation on to their products and services. When the economy is more dynamic, that’s fine, but that’s not the case now. The bargaining power of unions is reduced.”

The floor of salaries was R$ 1,332 in 2021, a variation of 4.5% compared to the previous year. Fixed benefits, such as food stamps and food stamps, have practically not changed from one year to the next. The first remained stable at R$22, while the second went from R$275 to R$280, a variation of 1.8%.

Food inflation, according to the INPC (National Consumer Price Index), was 7.71%. The INPC is calculated by the IBGE (Brazilian Institute of Geography and Statistics) and considers the effect of price changes on families with an income of up to five times the minimum wage. The index is the most used in salary negotiations.

By economic sector, the one with the greatest lag between the median readjustment percentage and INPC inflation was services. Responsible for about 70% of Brazil’s GDP (Gross Domestic Product), the segment was one of the most affected by the restrictions imposed by the pandemic, such as the closing of bars, restaurants and hotels.

According to the Salariómetro, the difference for workers in this sector was 38.9%. By region of the country, in the Northeast, formal employees received the lowest median readjustment, of 5%, and had the greatest negative variation in relation to the INPC, of ​​-39.4%.

For this year, the Salariometer coordinator bets on better negotiations from the second half of the year, when inflation should start to fall. Projections from banks Santander and Itaú point to an INPC of 10.2% and 10.1%, respectively, in May this year.

“With the INPC accumulated in double digits, there is no room for real gains. Even so, this will be another complicated year, with elections and rising interest rates. The situation is not good for workers.”

About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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