In another sign that the economy may be in much worse shape than government officials seem willing to admit, companies said their need to hire workers in April fell 48% from the same month a year ago.
Demand for workers also fell almost 12% from March, according to a new labor demand survey by Torcuarto Di Tella University.
A lot of companies are laying off workers or cutting back on hours. But the government is pulling out all the stops to a) prevent firms from firing workers; and b) prevent information about layoffs from becoming public. In some cases, companies are told that if they lay off workers, they will have to deal with vigorous inspections from federal tax officials.
In others, Labor Ministry officials use stringent regulations to delay layoffs for months on end by forcing firms to engage in “conciliatory” negotiations with employees unions.
Businesses naturally complain about the local labor market, saying that the high cost of hiring employees makes them think twice before hiring them. Whatever the benefits or impediments of local labor laws, Argentina seems to be avoiding, for the most part, the mass layoffs that are slamming developed markets.