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Argentina’s Response to Economic Crisis Through Social Protection

Record unemployment is one of the consequences of the global economic crisis, but in Argentina, fewer jobs were lost in the crisis than in many other countries. A new report from the ILO found that’s because Argentina learned some lessons from a bitter experience in the past, and protected jobs when hard times came around again.

Date issued: 16 November 2010
Size/duration: 00:03:56 (12.8 MB)

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Script:

In 2001, a political, economic and debt crisis devastated Argentina. The peso lost three quarters of its value; half the country’s people were reduced to poverty. Unemployment spiked at 32 percent.

In the worst days of the crisis, 40,000 people scavenged the streets of Buenos Aires for cardboard to sell for a few pesos. The “cartoneros” became the symbol of Argentina’s economic casualties.

Ester Collados, Cardboard Scavenger (in Spanish)

It is hard when it’s cold, you cover yourself with whatever you have, and when it rains the cardboard gets wet, and we get less money.

In 2001, one of the most important steps taken by the Argentine government was to provide a measure of social protection to those hardest hit: a modest sum, 50 US dollars a month, was paid out to two million unemployed families. It worked.

Enrique Deibe, Secretary of Employment (in Spanish)

The process of recovery for the poorest sectors, those facing the most difficulties, helped us to overcome a period of much deterioration in Argentina. It stimulated consumer demand in the poorest sectors which boosted the domestic and local economy.

Argentina subsidized salaries, providing money directly to employees, both protecting jobs and helping employers.

Angel Vazquez, Factory Owner (in Spanish)

It has allowed us to get over it without laying off people, which would have been very upsetting.

Factories and businesses reopened, creating four million jobs. According to the ILO’s World Social Security Report, Argentina’s response in 2001 meant it was better positioned to weather the recent global economic crisis.

Michael Cichon, Director, ILO Social Security Department (in English)

Argentina, in 2000…2001, had an unemployment benefits scheme in place, but it was only covering the formal sector…but it had the knowledge, it had the people, and it had the methods to actually introduce a redistributive system that reached out to the informal sector very quickly. And it has that system called “jefes y jefas” in place now, and it can automatically expand to whenever the need arises again. And so it did in 2009.

Ignacio Nelson Gallo/Cooperative Manager (in Spanish)

The global economic crisis in 2009 affected us. Our sales decreased by 40 or 45 per cent.

The “productive recovery programme” that was started during the earlier crisis has so far saved 140,000 jobs that would have been lost in the current crisis.

Re-training and cash transfer programs to support young people hardest hit by the crisis have helped 100,000 or more.

Lucas Vilte got a job in a meat factory. He now makes 150 dollars a month.

Lucas Vilte, Factory Worker (in Spanish)

The programme has given me the chance to get a job here today, and to acquire skills. I like it.

Argentina believes the focus on job protection means the country is better prepared to handle the effects of the global economic crisis, and that other countries can learn from their experience.

Dr. Carlos A. Tomada, Minister of Labour, Argentina (in Spanish)

We believe that only by protecting employment and maintaining the level of salaries, will we manage to maintain an active economy.

Even the lives of the “cartoneros” have changed for the better. They no lobger scavenge to survive, but instead run a recycling cooperative. After signing a five year deal with the city, they have job security, as well as social and health benefits.

Roberto Gomez, Cooperative worker (in Spanish)

Our dream is the same as any other workers, to have an income, sustain our families, send our kids to school, the dream… the dream of all workers.

Tags: employment, precarious employment, temporary employment, youth employment, employment policy, unemployment, economic and social development, social development, social security administration

Regions and countries covered: Americas, Global, Argentina

Unit responsible: Department of Communication (DCOMM)

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