Informal employment rises to 42%, affecting 4 in 10 workers

Informal employment is on the rise in Argentina, with around four in ten workers now earning money off the books, a new study shows.

Argentina’s “informality rate” stood at 43.2 percent in the second quarter of 2025 (April-June), a rise of 1.6 points year-on-year, according to a report by the Employment, Distribution and Labour Institutions (EDIL) division of the Interdisciplinary Institute of Political Economy (IIEP).

According to the report, four in ten workers in Argentina are employed in jobs that are not subject to “the relevant legislation, whether labour, tax or social security.”

Data crunched by EDIL experts shows that 37.7 of workers were employed informally in the second quarter of 2025, with the number rising to 62.5 percent among the unemployed.

Compared with the same quarter of 2024, informality among employees is up by 1.4 points (from 36.3 percent). Four in 10 salaried workers are not registered with social security and therefore not covered by labour legislation or institutions.

Since 2003, the employee informality rate has matched the level observed in the fourth quarter of 2008 (October-December). It is now at its highest since then, with the sole exception of the second quarter of 2022 (37.8 percent).

“Beyond fluctuations (and excluding the Covid-19 pandemic period), the employee informality rate has remained very high for the past 17 years,” the report states.

In the first quarter of 2025 (January-March), informality was higher among women: of the total rate of 42.1 percent, women stood at 43.2 percent and men at 41.1 percent.

Given the greater share of overall employment is male (56 percent), they accounted for 55 percent of total informality.

Young people face significantly higher levels of informality than other age groups, said the EDIL. In the first quarter of 2025, the rate among 16 to 24 year-olds reached 63 percent - 21 points above the overall average.

That means six in ten young workers are employed informally. “This elevated proportion is one of the many ways in which this age group faces obstacles in Argentina’s labour market,” the report said.

The next highest group were workers aged 25 to 44 (41.4 percent), followed by those aged 45 to 64 (34.5 percent). Among those aged 65 and over, informality reached 51 percent.

“However, there is no linear correlation between age and informality. Instead, it follows a U-shaped pattern, with higher rates both at the start and at the end of working life.”

The informality rate for those in domestic service and construction reached 75.4 percent, the report found. By contrast, within financial services, it stood at 20.9 percent.

“These values are particularly critical, as they concentrate a higher proportion of men and women with low levels of education. Around 25.5 percent of men with incomplete secondary education work in construction, while almost 32 percent of women with the same education level work in private households,” EDIL reported.

In the first quarter of 2025, 24 percent of workers lived in poor households. Among informal workers, the figure soared to 42 percent – effectively, four in ten informal workers were living in poverty.