Argentina’s unemployment rate increased to 7.5 percent at the conclusion of the previous year, marking the highest fourth-quarter figure since the Covid-19 pandemic, as job losses intensified prior to the passage of a significant labour reform by Javier Milei’s administration last month. The jobless rate in Argentina’s formal sector increased for the first time in three quarters, while informal employment remained stable at approximately 43 percent of the employed population, as reported by the INDEC national statistics bureau on Wednesday.
Since Milei assumed office, Argentina’s formal private sector has experienced a decline of over 200,000 salaried positions, representing approximately three percent of its total workforce. The administration has implemented cuts to several thousand government positions; however, the unemployment rate has not experienced a consistent rise throughout his tenure, which can be attributed in part to a growth in freelance and informal employment, as indicated by a different set of official data.
Milei achieved a significant legislative milestone in February as Congress approved a diluted iteration of his labor reform, which relaxes regulations and expenses associated with hiring, terminating, and severance, along with various other technical adjustments. While markets expressed approval of the reform, experts caution that it is improbable to swiftly result in job creation, given the sluggish economic activity, diminished consumer spending, and the challenges faced by labour-intensive industries as Milei liberalizes the economy.