The gap between public and private employment is widening: state workers earn almost 40% more

“The long-term trend that we have observed for years in the labor market is the non-creation of private salaried employment, the highest quality, but of public jobs, in an already oversized State. Every time we see that market conditions improve. labor is due to the rise in this sector “, graphs Virginia Giordano, research coordinator of the Institute for Argentine Social Development (Idesa).

The INDEC data processed by Idesa illustrate how the pandemic deepened the gap between the two highest quality employment categories (public and private), generating less damage to the state one.

In Greater Córdoba (Capital and nearby towns), as of June, the Idesa report on Indec data reveals 82,197 public and 199,360 private employees, 51 percent of total employment in the territory.

Although both groups in general kept their jobs, the private sector fell by 6% against 1% in the public sector.

The income gap also widened: the average salary of each group surveyed by the permanent household survey (EPH) fell, in real terms (with the impact of inflation computed), by one percent for the state and seven percent. for the private.

Thus, state-owned companies went from earning an average 31 percent more than private ones in the first quarter to getting almost 40 percent (39.5) more in the second, when the pandemic and quarantine were already hitting the economy hard.

As of June, the average remuneration among public employees was 44,929 pesos, against 32,207 pesos for private employees.

If we look at both sectors by income bracket, the better relative situation of the state ones is remarkable.

Among public employees, 47 percent declare salaries that start at 40 thousand pesos a month (approximately half between 40 thousand and 50 thousand pesos, and the rest between 50 thousand and 140 thousand, according to the table of ranges of the EPH).

However, among the private ones, only 22 percent have incomes greater than 40 thousand: 11 percent receive between 40 thousand and 50 thousand pesos, and another 11, between 50 thousand and 140 thousand pesos.

At the other end of the scale, only six percent of public wage earners are below 18 thousand pesos per month, while 25 percent are among private ones.

Atypical parity

The pandemic changed the usual dynamics of collective bargaining. It put the parities almost on pause in the first semester, the period to which the INDEC data mentioned here apply.

It is estimated that, at the national level, 73 percent of jobs are under high coverage “collective agreements.” As the months passed, and with greater dynamism since September, unions and employers resumed the formal discussion, negotiating compensation for the 2020 joint venture.

The national Ministry of Labor ensures that, currently, 84 percent of total employment under these agreements has salary increases established by the 2020 parity.

However, in many cases the agreed increases did not manage to overcome the erosion caused by inflation or included non-remunerative components that do not impact the base salary.

At the same time, 16 percent of the workers under these high-coverage agreements have not yet negotiated increases for 2020, and in the same situation are those who work outside that umbrella, such as self-employed and non-formal employees.

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The original text of this article was published on 11/29/2020 in our print edition.