Unemployment spikes as recession brings more bad news

The recession that affected economic activity in the first quarter has had an impact on real income, activity, and employment. Data emerging since December has shown a loss of 275,000 salaried accounts, with the construction sector being particularly hard hit, losing 57,382 registered jobs in five months. Additionally, the public sector lost 11,534 positions in just four months. The Ministry of Labor, Employment and Social Security of the Nation reported the loss of 62,920 jobs from the inauguration of Javier Milei until February.

The Labor Indicators Survey estimates a further drop of 34,000 positions in March. Analysts do not foresee a significant change in this trend in the coming months and predict that unemployment could reach around 9% by the end of the year. Chief economist Lorenzo Sigaut Gravina believes that the recovery of employment will be slow and that strong employment growth is unlikely this year.

Despite some sectors such as mining, hydrocarbons, and agriculture showing growth, the sectors that are driving activity currently do not generate much employment. The labor market is expected to remain challenging, with unemployment potentially reaching 10% by the end of the year. Some economists believe that employment may not return to previous levels anytime soon, even after the economy begins to recover.

The employment crisis is not just reflected in job losses but also in the shifting quality of employment. The debate over labor reform is ongoing, with some experts believing that reform is crucial for generating genuine employment. Others argue that employment recovery will only follow an economic recovery. The future of the labor market remains uncertain, with significant challenges ahead as the economy continues to struggle.