The companies surveyed by CONA RH have forecast annual inflation for 2023 of the order of 130%, the most optimistic, while the other end is estimated at 152% for the current year. In this sense, the salaries of personnel in a dependency relationship are behind the CPI of the order of 6 to 8 points in the January/July 2023 cycle. In this context, since not all companies have been able to align with the cost of living, they only adjusted that value and something more for the positions qualified as low skills.
This is revealed by the surveyed sample made up of SMEs and other large companies belonging to predominantly industrial, service and retail activities.
As a reflection, although different updates or adjustments have been registered, they always run behind inflation at the time of application and values. The famous phrase about inflation taking the elevator and wages taking the stairs may be the most up-to-date synthesis of the subject.
Another central aspect in this survey is the consolidation of quarterly increases instead of quarterly ones. 63% of companies adopted quarterly adjustments based on growing CPI records. Even so, this implies that quarterly adjustments exceed 20%, which implies a strong negative impact on purchasing power. This factor makes us predict that if these indices continue, companies will migrate towards bimonthly adjustments: in fact, there are 15% of the surveyed companies that already do so.
But it is not just about numbers, since the estimated increases continue to be slightly below inflation, which affects the organizational climate and promotes interest in changing companies, also explaining the high turnover of many organizations in the last three years. : collaborators change to improve their income. That pattern is becoming more and more frequent.
For 2024, companies have not yet defined a budget, which will only be possible by October, at which time parent companies and directories send their forecasts and other data for preparation.
In this electoral scenario, it is clear that the problem is inflation. If it continues at the same levels, the aforementioned practices will continue; If with a new government the CPIs are reduced, the adjustment period will increase, and if businesses rotate with increasing demand, they can improve the increases to balance their relationship with the CPI.
Carlos Contino is managing partner of CONA RH
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by Carlos Contino
