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ECONOMY | 05-07-2023 12:32

Report: Public employment up 34% in Argentina since 2011, private only 3%

New report by IERAL, business school of the Fundación Mediterránea think tank, shows a massive imbalance between the growth of public and private sector jobs in Argentina. Only province in which private-sector jobs grew faster was Neuquén, thanks to Vaca Muerta. Córdoba recruited the fewest state employees.

Argentina’s difficulties in creating private-sector jobs have been exposed by a new report highlighting a stark imbalance between public and private employment over a sustained period.

According to a new report by the IERAL think-tank taking into account the three levels of national, provincial and municipal governments, public-sector employment rose 34 percent between 2011 and 2022, while private-sector jobs increased only three percent over the same period.

According to IERAL, Misiones, Chubut, Santa Cruz and San Luis increased public employment jobs by over 60 percent in the last 11 years. In the case of Misiones, by 93 percent at provincial and municipal levels since 2011, while formal salaried private-sector employment rose 12 percent.

In contrast, Córdoba is the province with the lowest increase in public employment, equalling the three-percent rise in formal private-sector employment in the same period. 

Neuquén was the only jurisdiction in which the private-sector jobs (salaried and formal) climbed more than public employment (provincial and municipal) with respective percentages of 39 percent and 33 percent in the last 11 years, clearly due to the effect of Vaca Muerta shale.

The data forms part of a report on the financial state of the provinces on the basis of their recently published fiscal results. A priori, the latter has been improving at subnational level thanks to higher national remittances and owing to the Mauricio Macri administration returning funds held back from the period of the AFJP private pension funds, it also concluded.

The study indicates: "Financial results in the provinces improved slightly in 2022, prolonging a trend registered since 2015, only interrupted in 2019. Last year’s surplus (0.5 percent of gross domestic product) was the highest since 2000, only topped by the financial result observed in 2004 (one percent)."

El IERAL points out that apart from the increase of national transfers to the provinces beginning in 2016, the other factor permitting the improvement of the fiscal accounts has been the fall in spending on personnel.

"In 2015, these items captured 60 percent of current provincial revenues but had been cut to 47 percent by 2022,″ says the study.

Nevertheless, despite the spending on personnel declining in all provinces, employment is up, the Fundación Mediterránea’s business school observed, presumably due to a fall in real wages.

"In the context of the stagflation of more than a decade, public employment in provincial and municipal governments grew around 35 percent between 2011 and 2022 while at national level it rose 28 percent. The consolidated variation is 34 percent, compared with an accumulated rise of three percent in the formal salaried private-sector employment in the same period,” it reads.

 

– TIMES/NA

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