what happens to salaries in this fateful 2020


The extension of the quarantine breaks the hope of specifying the increases established at the beginning of the year. The focus today is to preserve employment

The coronavirus crisis has an impact on the wages of out-of-agreement workers. Most of the companies implemented or is planning to implement deferrals, decreases and cancellations of planned increases.

To a lesser extent, cuts were made in salaries of bosses, supervisors, managers and executives, of around 15% on average.

“Freezing wages is the most frequent form of wage control. pay cuts they are less frequent and executives are generally the most affected by the compensation reductions, “says Korn Ferry, who surveyed the situation of 95 companies between May 20 and 28.

Meanwhile, the Willis Towers Watson (WTW) survey reached 312 companies between May 28 and June 8, Clarín said. On average, the companies consulted They plan increases to their employees outside the agreement of 37.2%.

The numbers from Mercer’s “Spot Survey # 5 Covid-19,” conducted June 25-30 with 275 companies, show a similar picture. Only 23% believe they will keep the second salary increase of the year unchanged, and 48% have not yet defined whether or not they will make changes to the planned budget. Of the rest, 10% have already defined that they will modify it downward, 9% will reschedule it in subsequent months, 6% will modify it upward and 4% will not grant it directly.

Mercer added that 92% of the companies consulted will modify their teleworking policy as a result of the pandemic.

According to the Hucap report, which reaches 127 companies, “83% of the companies that modified or will modify the budget that they had destined to wages, 38% already defined offering lower increases “.

Out of agreement wages and pandemic: what will happen?

In early March, Human Resources specialists were encouraged to whisper under their breath that the increases that were pausing were going to recover in the second half of this 2020.

Today that hope is diluted. Of course, there are exceptions, especially in the sector linked to the Knowledge Economy, which has been growing and agreeing its salaries above the local average, although still below international wages.

“We are facing an extremely complex situation. The companies do not have the resources or to pay the bonuses“warns iProUP Paula Padilla, partner of Laboral de Auren, without hiding her concern.

And it completes: “Every month, to pay the salaries, we wait until the last moment, to know well what they want to pay. So you don’t even talk about parity. In our experience, the increases in the third semester will be equal to zero“he warns.

The look of Federico Carrera, Managing Partner of High Flow-Grupo DNA, is not so different. “During the close of 2019, firms projected improvements of 40%. When 2020 began, many began to look at adjustments that were around 45% or 50%. But, in this context, in which many had to reduce wages, not there is a common denominator for the job market in general. very few agreements and with disparate figures in each sector, “he says iProUP the specialist.

Even there are even more disturbing claims. “Today there is greater concern about keeping jobs than wages. Obviously, the theme will explode when you notice the high inflationary process which implies the current monetary issue “, assures iProUP head hunter Cristina Mejías.

¿Which industries are better off to face the next months? “Pharmacy, logistics and technology have flourished above the rest currently and will continue on the podium in the second half of the year. Also some companies massive consume, companies of hygiene articles, sanitary textiles“lists iProUP Claudia Sadowyk, Bayton manager.

In the counter are the tourism, transport and hotel sector. For the first time, the oil & gas gets off the podium of the best positioned in terms of remunerations. “The drop in prices will hit the big oil companies hard and wipe out the small ones all over the world,” says Sadowyk.

Paritary: what was that

Day by day, everything is tinged with uncertainty and in many cases even pessimism.

“The situation is becoming increasingly complex for most organizations. While we cannot fail to mention that inflation remains a matter of concern, no room to even think about salary bargaining“remarks to iProUP Miguel Terlizzi, President of HuCap.

According to the study of Compensations, Benefits and Trends of the consultant, in which more than 125 first-line companies from different sectors participated, one in three plans to decrease their endowment for the rest of the year.

“Also, there are firms that are being assisted by the State to pay the salaries your employees, while SMEs and mini SMEs in some cases the inability to continue with their businesses, “adds Terlizzi.

According to the expert, “the guilds are busy negotiating suspensions, salary cuts and the reinforcement of the decree that prevents companies from firing personnel, for which they are clear that there is not much space or margin to guide the joint agreements 2020

The surprise: the oil industry will not pay as good increases as it used to

The surprise: the oil industry will not pay as good increases as it used to

¿Negotiations will be reactivated once the quarantine ends? According to Terlizzi, this “will depend on the situation where the companies are once this happens and the capacity of each item to start the operational wheel of the business. ”

“This could already be considered a lost year for most organizations. Not to mention the unionswho are completely stopped: the first negotiation they’re doing is mostly protocols to get started to operate, rather than talk about increases, “he says.

Stillness is also felt in the inside of the country, although many provinces already have more activity. “Rosario and Córdoba are very dependent on the automotive, metalworking and food industries, all industries badly beaten; Despite the opening, the situation is complicated. At South, the oil it’s complicated, “he tells iProUP Ana Renedo, partner at MR Partners.

And he adds: “Another important industry in interior is tourismwhat the moment is zero. Only agriculture and technology remain as engines of development and that clearly is not enough. ”

Light of hope

Taking into account that the countries that previously entered isolation regimes begin to start up their economies, in Albiceleste lands some begin to base their analyzes on this logic.

“The opening of quarantine will positively influence before an eventual rise in wages, given that the AMBA represents approximately the 40% of the country’s activity. As a consequence, this can change expectations regarding salaries, ” iProUP Maximiliano Schellhas, general director of Staffing of Randstad Argentina.

And he completes: “If we add to this a possible settlement of the sovereign debt with creditors, it would further improve the favorable climate. In any case, we do not expect any further talk of the 40% or 42% annual increase levels. that had been estimated in March. ”

The end of quarantine could be the time when higher increases are projected

The end of quarantine could be the time when higher increases are projected

Lastly, although it becomes expensive to give increases, the firms have put determination to recognize the effort of its collaborators. “This situation has generated benefits around fixed costs, both for employers and employees “, details iProUP Gustavo Aguilera, director of Talent Solutions and People & Culture of ManpowerGroup.

“Some companies began to identify those who have an exceptional performance in these times, granting extraordinary perks, gifts in their homes like breakfasts or snacks through delivery. In short, actions aimed at demonstrating to those who put their shoulders that their commitment is valued, “concludes the expert.

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