translated from Spanish: Mario Marcel invites dialogue and expresses caution on the macroeconomic effects of the 40 hours: “It is difficult to argue that reforms will have no impact on this plane”

This week MEP Camila Vallejo (PC) responded to the central bank’s (BC) criticism of the “40 hours” project and assured that economists do not see the reality of Chilean families. In turn, the former finance minister of Michelle Bachelet’s government, Nicolás Eyzaguirre, stated that while the executive “was cautious and the Central Bank has the right to give opinions, for the benefit of its autonomy it must refer to the things that are in its mandate and the 40-hour bill hardly is.”
Vallejo and Eyzaguirre’s criticism comes after the issuing body’s chairman Mario Marcel warned that a project like this along with the universal crib and pension reform – with an extra 4% of the employer’s expense – could raise the cost of 15 to 29 percent. Today, Marcel returned to the ring, and referred again to the work-life reduction project. Calling for deepening the discussion of the issue in Congress and considering its effects.
In an interview with La Tercera, the Central Bank holder emphasized that a fuller and more weighted analysis of these initiatives is necessary, “taking into account their magnitude, the environment in which they occur, and other reforms discussed in parallel.”
“That is why we note that the proposed reduction-of-time alternatives are more significant than the one adopted in 2005, which take place in an economy with a growth potential of 3% and not 5% in 2005,” he said.
Under this premise, Marcel assures that the spirit at Central is to encourage constructive dialogue, not controversies. “As for the relevance of a macroeconomic perspective in this dialogue, it seems difficult to argue that the time-to-day reforms, along with others that affect the cost of procurement, would have no impact on this, he warned.
Asked about the increase in labor costs with this project, Marcel noted that “by adding up the labor cost of the reduction of the day (depending on whether it is 35 or 41 hours), which would be between 9% and 22%, with the 4% increase in the pension contribution (which in the disc we have considered adding another 2%), 0.4% for the crib project and dependency insurance of 0.2%, gives a range ranging from 14% to 29%”.
That’s why he called for these things together in the legislative process, “because the employer will have to bear all those costs and the worker will be affected by the way the company adapts.”
According to the economist, this adequacy will also affect the performance of the economy, including its growth potential.
“There are proposals with graduality components, there are proposals with mitigating elements, and other aspects of that kind may arise in the discussion. All of these initiatives have an important part of the legislative process ahead of them, so having depth is desirable for all the actors involved,” he concluded.

Original source in Spanish