Unaffected Middle Class

[RicardoBA]

One contributing factor which helps the middle class in Argentina, is that the real estate has been paid for years ago. Many of the apartment dwellers in the city center are living in places which were paid for by their parents or grandparents years ago. Since they don't have a house payment then they are able to use most of their monthly incomes on their day to day expenses. In addition, many of them have their elderly parents sharing the apartment with them.
This is not only true in this culture, but you find it in Italy,Spain,etc.

 

[bebero]

Most of my argentine middle class friends get a raise every 6 months and can afford to take a trip once a year without going into debt.

I realize saying this will not make me popular, but things are not as bad as they were 10 years ago.

The expat way of life is a lot more expensive. From how much the rent is to the lifestyle.

 

[AndyD]

AFAIK, debt indicators are not high in Argentina compared to other countries, at all. Cheap credit for buying TV sets is hot but, for example, few Argentines have mortgages on their houses.

On the other hand, typical Argentine middle class lives in less-expensive places than Barrio Norte and doesn't travel abroad. In a country of 40 million, there are only about 2 million tourists flying abroad per year, including foreign residents and counting recurrent travelers more than once.

But I wouldn't expect to see a significant impact in the lifestyle of the middle class, at least not yet. Inflation has eaten up income among those who don't belong to a strong union, and I would expect that situation to somewhat worsen in the following months, but we arrive at this point with momentum from a decade of strong growth. As someone said above, it's different for expats measuring their expenses in foreign currency.

I don't mean that I'm happy with the state of our economy, quite the contrary, current trends in household income don't paint the full picture.

 

[flurec]

I xoomed myself some money and had a friend of mine pick it up at Banco Frances. She works in cleaning en negro- her income is as low as it gets. She doesn't even have an account at Banco Frances but they were hassling her so much about signing up for a credit card that she just did it so she could pick up the money and leave.

Her new Mastercard arrived in the mail. My mind... blown.

 

[fifs2]

My wife works for one of the big auditing firms here. Their salaries were supposed to be revised the first of this month (meaning the 2nd, the 1st was a holiday), however, there seems to be a freeze in pay increase because pay increases are not sustainable (don't know all the details about that, and wouldn't write them here even if I did ).


Sympathies to your wife nico and her employer! Unsustainable is the key , especially for us as business owners with 9 years of 20-32% raises. We had hoped the early years large increases were because of coming from such a low base but it's now the norm just to keep up with cost of living. We have no domestic customers and although our customer spans from China to Sweden no customer will tolerate any % increases on prices. We're in salary negotiation time again and again we're wondering how we can keep our Bsas base as it's just simply not viable to have en blanco employees anymore..if we had them in negro the USD exchange differential could help us but there's just not enough now to cover any 25% raise which is the expectation. We've exhausted all non cash benefits possible (gym, viaticos etc etc) and at the end of the day we're just so sad that the employees and the employers (in Pymes at least) lose as a result of the country's approach to inflation and the govt manages to escape blame as it clverly pits the bad business owner against the greedy union member when both should be united in their ire against an incompetent economic policy. Salary raises in Brazil will again be in the 5-7% range...what a different story it's been for us there.

 

[Gringoboy]

A friend of a friend of ours recently spent US$70k on her daughter's 15th birthday party.
My jaw dropped when I heard. That's nearly half of what we paid for our house!

 

[jazrgz]

Most of my argentine middle class friends get a raise every 6 months and can afford to take a trip once a year without going into debt.

I realize saying this will not make me popular, but things are not as bad as they were 10 years ago.

The expat way of life is a lot more expensive. From how much the rent is to the lifestyle.

I work in the compuer business and since we dont have a Union to represent us, we have not being receiving any income increase in the past 4 years. well, a 3 o 5 % yearly raise....and there´s millions out there who either work on other areas with the same problem (no union or very weak one), or work in negro or unemployed...put all together and you have millions of people here who are not getting their salaries raised (if they have a salary). Also add to retired ppl, getting paid 1500 pesos (nowadays completaly not enough to survive).....sure, there´s others getting their salaries raised who can afford anything. That´s what this govtmnt achieved, among other "great" things, is that the difference between rich and poor is huge now. the average salary in this country is about 4000 pesos yet those ppl to refer to get paid between 12k and 15k ...we never had in the past such difference in class and possiblities.

 

[El chabon]

A friend of a friend of ours recently spent US$70k on her daughter's 15th birthday party.
My jaw dropped when I heard. That's nearly half of what we paid for our house!

Middle class, really?

Sounds more like someone who makes a living ripping Argentines off just because he is a 'friend' of someone close to Cristina

 

[Ashley]

One contributing factor which helps the middle class in Argentina, is that the real estate has been paid for years ago. Many of the apartment dwellers in the city center are living in places which were paid for by their parents or grandparents years ago. Since they don't have a house payment then they are able to use most of their monthly incomes on their day to day expenses. In addition, many of them have their elderly parents sharing the apartment with them.
This is not only true in this culture, but you find it in Italy,Spain,etc.

I agree...A lot of middle/upper class people do not have to worry about making rent/mortgage payments which I think really changes attitudes towards money and working.
As far as raises are concerned, its really just hit and miss. Most govt/city employees seem to do really well. I have another friend in IT who has union protection and consequently gets a 20-odd% raise every 6 months. I work for a boutique company and have been getting less than 10% raises per year since 2008 (and no raise one year)... Its hard but I do understand that giving those kinds of raises in a company with less than 10 employees would probably cause us to go under!
I do know a lot of people who are living way above their means on credit. And I think those of us without paid-for homes are particularly feeling the pinch.

 

[syngirl]

Most of my argentine middle class friends get a raise every 6 months and can afford to take a trip once a year without going into debt.

The days of pay increases every 6 months are over -- most of my friends have had salary freezes for at least the past year (Nokia, Avon, NEC) and my husband's company announced that none of the professionals will be getting raises or bonuses this year -- but the guys in the workshops, you know, the ones that have a sindicato, they'll be getting their 30% raises -- a lot of the guys in the workshop are now making more than the engineers! And some are making more than the mid-level managers!