Salaries are growing in Latin America, but inflation is eating up the increase in several countries.
BY CHRONICLE STAFF
Despite having Latin America's highest inflation, executives and employees in Venezuela will see a net gain in salary growth of 7.0 percent, according to a Latin Business Chronicle analysis of new data from Mercer. That will be the highest net gain among Latin America's six largest economies.
The forecast is based on Mercer's estimates of an average 26 percent salary increase in Venezuela next year and the forecast from the International Monetary Fund of 19.0 percent inflation. The IMF made its forecast in the World Economic Outlook released last month.
However, if Venezuela's inflation grows beyond 19.0 percent, the net gain will be smaller. Mercer itself includes a forecast of 26.0 percent inflation, which would result in a zero net salary increase.
SUSTAINED ECONOMIC BOOM
On average, Latin America will see a salary increase of 8.5 percent next year, Mercer says. The largest six economies will see an average of 10.5 percent salary growth. "The region is experiencing a sustained economic boom, based on high oil prices and other natural resources," says Alberto Mondelli, Mercer's director of human capital in Latin America. "This pressures up salaries."
The Mercer data - released in its 2008 Global Compensation Planning Report, covers five levels of employees: executives, management, all professionals (technical/professional), para-professionals white collar (clerical/technical) and para-professionals blue collar (operational).
Executives and workers in Mexico, Latin America's second-largest economy, will see...
Keywords: Argentina, Brazil, Chile, Colombia, Mexico