Argentina's labor market improves hand in hand with the economic upturn in 2021

Buenos Aires, 23 Mar The labor market in Argentina managed to recover last year thanks to the growth of the country's gross domestic product after the pandemic hit and, although the economy has not yet returned to pre-recession levels that began in 2018, the unemployment rate is the lowest in six years. According to the National Institute of Statistics and Censuses (Indec), Argentina's gross domestic product (GDP) recorded in the fourth quarter of last year an increase of 1.5% compared to the third quarter and an improvement of 8.6% year-on-year in 2021, accumulating growth of 10.3% in 2021. Thus, the economy managed to emerge from the recession that had begun in 2018 with a fall of 2.5%, which continued in 2019 (-2.1%) and deepened in 2020, following the outbreak of the pandemic in Argentina in March of that year, with a fall of 9.9%. According to official data, the level of activity achieved in the last quarter of 2021 was above that recorded just before the outbreak of the health crisis. The INDEC report reveals that, at the sectoral level, the 2021 recovery in GDP was driven by the uptick in activity in construction (27.1%), hotels and restaurants (23.5%), industry (15.8%) and trade (13.2%). UNEMPLOYMENT GOES DOWN Indec also announced on Wednesday that the unemployment rate for the fourth quarter stood at 7%, four percentage points below the index recorded in the same period in 2020. The unemployment rate reached at the end of 2021 is the lowest since a new statistical series of labour market measurement began in 2016 and since 2015, when INDEC, under the previous measurement methodology, reported an unemployment rate of 5.9%. The net number of unemployed people fell to 947,000 people in the fourth quarter of 2021, almost half a million less than in the same period in 2020. On the other hand, the employment rate (percentage of the employed population) stood at 43.6 per cent in the fourth quarter, the historical maximum of the statistical series started in 2016, with 12.6 million people employed, one million more than a year ago. According to official data, some 600,000 formal salaried jobs and another 400,000 salaried but informal jobs were created in the last year. MORE FORMAL WORK Precisely, one of the improvements observed last year in the Argentine labor market has been an increase in registered salaried jobs, which, according to official figures, amounted to 6.1 million last December, achieving a return to pre-pandemic levels, but still somewhat below those recorded in December 2017, before the start of the recession. Various private reports note that this growth has been diverse, depending on the sectors. Those that are more dynamic, such as industry and the real estate and construction sectors, are already operating at higher employment levels than the pre-pandemic, while others - such as mining - are still recovering and approaching that threshold and a third core of activities - including hotels and gastronomy - have not yet left the phase of destruction of jobs. “The economic recovery is still heterogeneous, but decreasing. Dynamic sectors continue to command job creation, while sectors in recovery are consolidating and those that were in crisis a few months ago have begun to grow today,” the Argentine Center for Political Economy observed in a report. Despite these improvements, official data show that problems of job insecurity still persist in Argentina, with almost one-third of the employed (27%) working on their own account and with three out of ten employees (33.3%) working informally.