Employment, salary and equity during the recent recuperation of Argentina

Abstract

Argentina went through an unpredented economic and social crisis at the beginning of 2002, when GDP, employment and wages plummeted. However deep, the crisis did not impede the rapid recovery that started as early as in the second semester of 2002, particularly in terms of employment creation. Even excluding Plan Jefes' jobs, net employment creation was sustantially greater than expected (considering GDP growth) between the third quarter of 2002 and the same period of 2004. Real wages increased at a lower rate. The paper aims at studying the features and reasons behind employment recovery and wage dynamic during the expansionary phase, and their impacts on income distribution and poverty. By examining the factors explaining the high urban GDP-employment elasticity, a discussion about possible future paths is possible, mainly, regarding its eventual medium term sustainability.