The fall in employment not hit bottom yet. According to the latest report on labor indicators from the Argentine Industrial Union (UIA), between July of this year and the same month of 2019, 302,494 jobs were lost in the formal private sector. It implies a decrease of 4.9%. This market segment has already two years back.
The private employment indicator had until July 23 consecutive periods of decline. But the industrial survey indicates that the trend continued in August, so they accumulate two years of bad results.
Between July and June the drop was 0.1%, with 5,939 fewer jobs. Anyway, this marks a slowdown compared to what had been happening in previous months.
Click to see the full video
“The greatest difficulties are reflected in the lower number of companies filing sworn statements (DDJJ) of employment in the SIPA (Argentine Comprehensive Pension System), a situation that fails to break the downward trend,” the industrial report states.
In this way, July showed a drop in the number of filing companies of the order of 4% year-on-year, a decrease of 21,673 firms.
The report also states that despite the strong year-on-year falls, some sectors continue to incorporate registered workers month by month. By case, the industry increased 0.2% (an increase of 2,582 positions).
On the other hand, the sectors most affected by the drop in employment were those linked to businesses stopped in times of greater restrictions due to the pandemic, such as construction (-28.6% year-on-year) and hotels and restaurants (-12.9%) and commerce (-2.8%).
According to the survey of labor indicators carried out by the entity, a new fall in private salaried employment is anticipated in August in large urban centers of -3.0% and in industry of -2.6%
The UIA data is linked to what INDEC showed last Thursday. Between the first and the second quarter of the year they were lost in total 3.7 million jobs. As of last March there were 20,879,000 positions and it went to 17,122,000 at the end of June, which represents a decrease of 18%.
According to INDEC, of the 3.7 million jobs lost, 289,000 corresponded to registered wage earners, 1,695,000 to informal wage earners and 1,774,000 to self-employed workers. It is because during the quarter, and due to mobility restrictions, many workers could not work, they lost their job or were unable to search.
Consequently, the unemployment rate rose from 10.4% to 13.1%, the highest level since the third quarter of 2004.
“This fragile situation requires thinking of comprehensive strategies that take into account the continuity of employment and the needs of companies to continue active in this delicate situation that does not seem to present major changes for the coming months,” said the UIA.
And he warned that “this situation extended in time puts the sustainability of companies in check, given the increase in costs implied by the current difficulties generated by the rigidity of the labor market as a result of the current regulations “.