Employment in the industrial sector stood at the end of last year between 1.2% and 3.3% above pre-pandemic levels, according to data collected by different public and private organizations, in tune with the activity of the industry that grew 15.8% in 2021.
The latest report from the Center for Argentine Political Economy (CEPA) revealed that employment in the industry, as of November last year, was 3.3% above (a total of 35,000 jobs) from the levels of February 2020, before the start of the pandemic, thus reaching numbers that match those of February 2019.
“What is clear is that at this point in the game, the industrial sector has been the engine of recovery both in terms of activity and employment,” CEPA director Hernán Letcher told Télam.
“What is clear is that at this point in the match, the industrial sector has been the engine of recovery both in terms of activity and employment”Hernán Letcher, director of CEPA
The report pointed out that, only in November of last year, the industry was the third sector of the economy (behind construction and commerce) with the highest generation of jobs, registering a month-on-month rise of 0.4%.
The increase in employment in the sector goes hand in hand with the rise in its activity which, according to the National Institute of Statistics and Censuses (Indec), closed 2021 with an annual increase of 15.8%. The highest level for a December since the start of the series in 2016.
For its part, the Center for Production Studies (CEP XXI), dependent on the Ministry of Productive Development, reported that formal employment in the sector, as of November 2021, exceeded 48,000 jobs compared to December 2019.
“The industry is well above pre-pandemic levels, recovering everything lost in 2019 and the pandemic in terms of employment, reaching numbers from the end of 2018,” the director of CEP XXI, Daniel Schteingart, told this agency.
According to the Industrial Production Index prepared by the agency, industrial activity grew 15% compared to November 2019, with sectors such as transportation equipment (+42.6%), automotive (+41.7%), and clothing , leather and footwear (+34.5%) more than doubling the general average.
The star sector was machinery and equipment with an expansion of 51.7%, which is explained above all by agricultural machinery whose production was the best so far this centuryHernán Letcher, director of CEPA
But the star sector was machinery and equipment with an expansion of 51.7%, which is explained above all by agricultural machinery whose production was the best so far this century.
“Although the 2021 harvest was not particularly successful, the rise in prices increased the margin of agriculture to invest,” Schteingart explained, adding that other factors were “financing for national machinery” and “import substitution.”
According to the Study Center of the Argentine Industrial Union (UIA), 2021 was the first year since 2017 in which the annual variation of employment in the industry is in positive numbersa period that extends to 2015 in the case of the manufacturing sector, with SMEs with less than 200 employees being the ones that incorporated the most workers.
However, there is still a long margin to grow since, according to the same industry organization, employment is still 11.9% (150,655 jobs) below its maximum registered in October 2013.
“In 46 of the 48 months of (Mauricio) Macri’s government, industrial employment fell, especially in the formal one,” Schteingart said.
“Until now what was lost in the pandemic has been recovered and since January 2022 what was lost with Macri has begun to be recovered”
Regarding the projections for this year, Letcher considered that there are several factors that affect the level of growth and considered that the reality is “if the creation of jobs is going to be sustained at the levels that were in the previous months or if there is going to be a more moderate increase”.
One of the factors is the recovery of real wages since the industry produces mainly for the domestic market.
It is, in real terms, “at the levels of December 2019” although, compared to the end of 2015, it remains “between 17% and 20% below”.
“Until now, what was lost in the pandemic has been recovered and since January 2022 what was lost with Macri has begun to be recovered,” said the director of CEPA.
Specific policies for the sector are also key, including access to credit which, until now, “because it is very cheap, has helped it a lot.”
In this sense, Schteingart highlighted that “today productive credit is at the highest level in three years and credit to SMEs represents 52% of it.”
Faced with the possibility that the Central Bank (BCRA) continues the increase towards positive rates, Letcher stressed the need to maintain “differential and subsidized rates for industrial SMEs.”
He also highlighted the evolution of the sector’s exports, which increased more than the average in 2021, and allow “improving the equation at the employment level.”
For his part, Schteingart estimated that industrial growth for 2022, as in the rest of the world, will moderate, to which are added “more adjusted levels of installed capacity and greater demand for imports.”
“For the recovery to be sustained, foreign currency is needed and for that it is necessary to export,” said the director of CEP XXI, who projected a greater traction of services for this year in the local economy.
