Informal work is one of the main debts of the Argentine economy: according to the latest data from INDEC, 43.2% of Workers He works without contributions or social coverage. This is the highest number since 2008 and reflects that six out of ten young people, and three out of ten adults, are not registered. In this context, the government encourages A Repair work To reduce informal activity and promote creation employment empty.
Far from implying a “setback” in terms of rights, flexibility aims to encourage sustainable employment generation. The challenge is enormous, but it is necessary to promote economic growth.
The weak capacity of the Argentine labor market to generate registered jobs, even in periods of expansion, responds Structural factors. Among them, High tax pressure: Argentina is among the three countries with the highest employment tax burden. Personal and employer contributions represent 34.6% of total labor costs, compared to an average of 21.6% in OECD countries. In other words, the cost of using white goods is approximately 60% more than in advanced economies.
This difference is in addition to the regulatory unpredictability and the costs of conflict between the parties. It discourages formal employment and pushes small and medium enterprises, the main job generators, to operate informally or under more flexible schemes. The result is A Dual market: A registered minority supports the rest of the economy, with negative implications for productivity, income and system stability.
the Regional disparities exacerbate the problem. While Patagonia has the lowest rates of black employment, in the Northwest and Northeast levels exceed 48%. At the sector level, the most affected sectors are construction and domestic work, where three out of every four employees lack contributions.
Impact on the retirement system
The increase in the number of monotributistas is a reflection of Informal “underground” work.. In the past thirteen years, this category has grown by 65%, compared to only a 3% increase in registered private employment. Of the two million new official positions created in that period, 85% were for the public sector and unilateral shareholding, and only 9% for the private sector.
This configuration not only puts pressure on the party’s financial resources YesYoForecasting systembut it also shows a A worrying trend: Job creation is concentrated in riskier ways or with lower contributions: 27 single earners are needed to equal a dependent worker’s contributions, and enrollees’ income covers only 70% of retirement expenses.
The combination of low productivity, high tax burden and regional gaps is the core of the structural problem. Solving this problem requires not only legal reform, but also changing the economic incentives that allow companies to grow and hire empty staff without implying unsustainable additional costs. companies or loss of competitiveness.
Formal job creation, in addition to being constrained by the structural factors mentioned above, also depends on the pace of growth of the economy and the intensity with which this growth is translated into new jobs. The latter is known as the elasticity of employment and GDP.
In economies such as Argentina, the sensitivity of registered labor to the product is low in the short run, but in the long run work becomes more procyclical: when activity expands in a sustained manner, employment accelerates and the relationship between growth and work strengthens.
A practical example to illustrate this is the following: If the economy grows by 4% in the first year, 3.5% in the second year, and 3% in the next three years, with an elasticity of 0.4 to 0.75, more than 1.1 million new registered jobs will be created within five years. In the early years the response will be moderate (1.2% to 1.6% per year), but as expansion strengthens, employment generation could double.
This can improve real job creation
Sectors that can generate real job opportunities
This behavior indicates that Reform must be accompanied by sustainable growth in order to show real results. Even with moderate expansion, the Argentine economy is able to create empty jobs again.
The success of modernizing the labor market will ultimately depend on the contribution made by different sectors to increase administrative work. Construction, agribusiness, energy, the knowledge economy, and manufacturing can, with the right incentives, generate Up to 250,000 new jobs registered annually.
What each sector can contribute
In short, labor reform must be understood as A tool that facilitates investment and formalizationNot as a political goal or a setback in rights.
In reconciling reform, growth and employment, the possibility of a structural transformation capable of rebuilding the foundations of formal employment and projecting a more prosperous Argentina is at stake.
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