Argentina’s much-touted turnaround under Javier Milei may be losing momentum, with fresh labor data pointing to a weakening jobs market, according to Bloomberg.
By the end of last year, unemployment had climbed to 7.5%—the highest rate for a fourth quarter since the Covid era—reflecting a deterioration in employment conditions before the government pushed through its landmark labor overhaul.
New figures show that joblessness in the formal sector increased for the first time in three quarters, while the share of workers in informal roles remained largely unchanged at roughly 43% of total employment.
Bloomberg writes that since Milei took office, Argentina’s formal private sector has shed more than 200,000 salaried positions—around 3% of its workforce.
Although the government has also eliminated thousands of public-sector jobs, the overall unemployment rate hasn’t surged as sharply as expected, partly because more people have turned to freelance or informal work to make ends meet.
In February, Milei secured a major political win when Congress approved a scaled-back version of his labor reform, designed to reduce hiring and firing costs and introduce broader flexibility into the labor market. Investors welcomed the move, but economists caution that it is unlikely to deliver immediate job growth.
With economic activity sluggish, consumer demand still weak, and labor-intensive sectors under pressure as the economy opens up, any employment recovery may take time to materialize.