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27 julio 2021

All Candidates Seem to Forget About the Labor Crisis. Published on Cronista.com

All candidates, from the opposition and from the governing party alike, with a few rare exceptions, seem to forget about the labor crisis caused by the economic situation and accelerated by the Pandemic, and just attempt to give a diagnosis of these dramatic circumstances. Most of them preach and even lecture as if they were experts but they do not have the faintest idea about what they are saying or promoting.

Article by Julián A. de Diego published on Cronista.com on July 23, 2021

The anomie and vacuity they show every day provide a snapshot of the biggest crisis that will inevitable continue to create uncertainty and especially mistrust, driving away companies, investors and entrepreneurs.

Day in day out we hear contradictions: they say they promote employment but at least one million jobs have been lost (based on SIPA data); they promise stability but Argentina ranks first among the countries with the highest inflation rate around the world; they say they encourage exports but they ban beef exports; they say they want to reformulate regressive taxes and encourage investment but they increase export and import duties and taxes in general; they say human labor is a top priority but they increase the number and amount of welfare programs with no incentive to go back to work; they say they value health care but they deprive workers from choosing their health care insurance providers freely; and finally they make promises during their electoral campaigns but then in practice no goals are achieved, and everything becomes frustration.

As a matter of fact, there is a disappointing poverty of articulation in candidates’ speeches; actually they do not even deliver speeches, they just improvise, without producing any new ideas, giving diagnoses as if the evils we are living are not directly or indirectly their responsibility or that of their political parties, both during campaign or while in office.     

Too many forecasts and no specific proposal to consolidate an economic model, which they all say should be based on strong economic growth coupled with an aggressive campaign for exporting highly-demanded products in the global market.

Even though it is true that the labor market depends on the economic policy, and especially on the prospective business reactivation and restoration, by the time the effects of the pandemic start to soften, leading to the New Normal, nobody would have offered the model of country we all want and just voiced countless contradictions, in particular from the ruling party and among the different factions of the same political party.

In this devastating scenario it is important to put forward some ideas that are explored in the most developed countries. The most relevant ideas include:

  1. The creation of an employment termination and unemployment fund to ensure payment of severance packages at the time of termination, like in Brazil;
  2. Finance the employment termination and unemployment fund through a redistribution of contributions to the National Employment Fund and Family Allowances System, in order to avoid another payroll tax;
  3. Reformulate severance payment for non-registered employment to support the National Employment Fund to finance #1 and #2 above;
  4. Design a general job promotion plan to bring the excluded into the labor market without distinction, eliminating social security contributions if a new job position is created, training new employees who so far have not had the chance to work and has been receiving welfare programs instead;
  5. Do away with any fraudulent maneuver in relation to the granting of welfare programs, like in the case of non-resident aliens who get an Argentine ID, collect the allowance and live in a neighboring country or pensioners or retirees who get the pension benefit in breach of the laws currently in force;
  6. Promote telework, which is worldwide regarded as the most important source of employment within the framework of exponential technologies;
  7. Promote training on computers, robotics and nanorobotics applied to services and industries at all levels;
  8. Computer literacy and syllabus reformulation to include computers as from elementary education, thinking of future job opportunities;
  9. Reformulate payroll taxes to readjust to a competitive scenario in the region where TODAY taxation in neighboring countries accounts for a half or a third of what is paid in Argentina;
  10. Build upon what has been built, creating an integral reform for employment and social security to lower costs in Argentina taking into account the regional context without affecting workers’ or employers’ rights and duties as provided by the laws currently in force;
  11. Promote company-wide and establishment-wide collective bargaining agreements to adapt to new ways of working and new technologies in line with robotics, IT and AI, considering that industry-wide collective bargaining agreements are usually retrograde;
  12. Pay wages and social security contributions through banks in all cases, including freelancers, in order to promote formal registration of employees at the private and public sectors, thus eliminating any fraudulent contracts at the national, provincial and municipal State level, in breach of the laws currently in force;
  13. Implement federal mediation systems before going to Court for labor matters and any litigation concerning the Workers’ Compensation Act [Ley de Riesgos del Trabajo], ensuring workers full and timely payment of compensation and severance packages;
  14. Reorganize judicial procedures for labor matters to regain expediency, efficiency and celerity as compared to the current time-frames and processes that actually lead to a denial of justice: «Justice delayed is justice denied». 

As our candidates are unable to come up with a single new idea and most of them are or have been the protagonists of the failure, I sincerely hope they explore and examine the topics proposed, including the future of human labor to improve the quality and focused contents of education, technical training, mechanisms to promote job opportunities for young people and updated employability skills for those who work, and a framework of competitive labor costs and social security contributions at the regional and global levels.

Por Julián A. de Diego
Por Julián A. de Diego

Fundador y Titular del estudio “de Diego & Asociados”.  Abogado, Doctor en Ciencias Jurídicas.

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