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OP-ED | 22-09-2018 09:21

Editorial: To everything there is a season

The latest employment figures are as good an example as any of this dualism and this balance with the jobless and the workforce both growing.

Yesterday’s change of season is fully matched by an economy which enables optimists and pessimists to go cherry-picking for buds of spring and winter chill alike, even if the latter firmly retain the upper hand. The latest employment figures are as good an example as any of this dualism and this balance with the jobless and the workforce both growing. A paradox easy enough to explain in statistical terms – the labour market could only absorb a fraction of newcomers within a growing population, with the jobs created and destroyed in the last year approximately equal at around a quarter of a million.

The 9.6 percent jobless figure at midyear posted by INDEC national statistics bureau on the last day of winter at least means that President Mauricio Macri escapes, by a whisker, the humiliation of flying off this weekend for the United Nations General Assembly in New York (thus skipping Tuesday’s general strike, lucky fellow!) with double-digit unemployment as the freshest news from his country. But otherwise there is little bright side apart from the minimal growth of the workforce (from 41.5 to 41.9 percent of the population).

The basis for gloom here lies not so much in the generally bleak data between the last two midyears reported by INDEC as in the quality of employment and future prospects. With even rampant inflation running at barely half the pace of devaluation, the worst is clearly yet to come for both unemployment and poverty. And this danger looms for a highly vulnerable workforce. Firstly, almost all the latest recruits (outside the rapidly decelerating construction industry) are joining the precarious informal and self-employed sectors – the workforce is also growing because more people feel obliged to do anything to make ends meet. And if we turn to registered employment, neither the public nor private sectors are looking good. The state remains swollen with only a fraction of the downsizing insistently demanded by the most orthodox economists, while public works are the first in line for budget cuts – in the private sector it would seem that a dead-end industry can only survive either via a savage devaluation making exports competitive (but harshly punishing most other sectors) or via an extreme protectionism separating Argentina from world markets. Not to mention the global overhang of robots.

No grounds for euphoria on this front but the government seems to have found fresh motives for serenity from other recent news – even if they must be disappointed by how little the latest turn of the judicial screw for the country’s most popular opposition politician right at the start of the week seems to have changed the subject (or the opinion polls). The next day the ‘Super Tuesday’ for Lebac bond redemption was smoothly weathered with both the dollar and country risk moving downward. Passage of the 2019 budget submitted at the start of the week with some weird forecasts but with most provinces on board might meet with some bumps in the road but should not crash. The International Monetary Fund (IMF) is responding sympathetically to requests for more flexibility although advancing two-thirds of its tranches to the next year could make 2020 and 2021 years of living dangerously – so much so that next October might start looking like a good election to lose.

This continuing optimism in a darkening economic scenario also leads to another question – who exactly are these people who govern us? They are at least sufficiently aware of the problems to increasingly change their message to ‘cultural’ from structural change but how should we see them? As reaching a level of denial which is starting to rival Kirchnerism? Or as champions of the long term in a country where the urgent is forever displacing the important? We do not need to answer that question now – but in little more than a year we will.

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