Causes Of Income Inequality In Argentina

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Causes of income inequality in Argentina


The objective of this work is to study the variable activity rate. To do this I have collected data through the INDEC page (National Institute of Statistics and Census). Macroeconomic variables help us understand the various situations that occur in a country and in the world. Due to its importance, it was chosen to be studied.

Within the document the variable is defined, the factors that influence and intervene in it are developed, this information is presented in the form of a cross -section and the corresponding analysis is applied.

The fundamentals set forth in this report are based on the contents learned in the Macroeconomics, completed during the second year of the Superior Technology in Business Administration.

The aforementioned issues are reflected below.


The activity rate indicates what population percentage of a country actively participates in the labor market. It is calculated as the ratio between the economically active population and the total population of a country. The economically active population (PEA) is composed of all people who provide their work (or not) to produce economic goods and services during a given period. That is, they are part of it both occupied and unemployed.

This variable is of great value to know the economic growth of a country for a period of time and depends on various factors such as: the incorporation of women into the labor market, the creation of flexible or part -time jobs, urbanization, urbanization,etc., These tend to generate an increase in it. On the contrary, the reduction in the fertility rate, the increase in life expectancy and the rigidity in employment contracts, tend to act in the opposite sense.

According to INDEC (National Institute of Statistics and Census of the Argentine Republic), the activity rate for the second quarter of the year 2020 is 38.4%, this means that of 100 people, 38 have employment or are looking for it fromActive form. In relation to the first quarter of 2020, the activity rate and the employment rate have suffered statistically significant variations, the first one has a decrease of 8.7 percentage points (P.p.), went from 47.1% to 38.4%, while the second decreases 8.8 p.p. (42.2% to 33.4%).

Another variable that also suffered variations in the second quarter was the unemployment rate, showed an increase of 2.5 p.p. In relation to the same quarter but from the previous year, this increase is due to the increase in the number of people who could not work, although he actively sought work, and the decrease in the total PEA.

These results reflect the impact that Pandemia had on COVID-19 on the labor market. In addition to restrictions on certain activities, inflation is another factor that has influenced people’s income. Employees and retirees are the most affected, since they receive their income without adjustment according to inflation. This does, in many cases, that the members of the families who do not work, or not have the age of working, go to look for a job to be able to meet their basic needs. Another consequence of inflation is that those who work part -time workshop seek additional job they currently have, or actively seek to change it with the aim of increasing their income.

Leaving the pandemia aside, one of the most important causes of the fall in the activity rate is labor informality. The main problem of having low registered employment rates are the excessive and suffocating social loads, these represent almost half of the salaries (31% contributions and contributions and 9% of social work). A great contribution to solve this problem would be the application of a tax reform that encourages the registration of workers, as well as it would be convenient to advance in sectoral agreements, giving special emphasis to rural, domestic employment and in the construction industry, sinceThey are the main ones that register informal workers.

Through INDEC, it can also be visualized that the activity rate in women is 41.2%, while for men it is 58.0%. These statistics show that the possibility of participating in the labor market differs between men and women, they face greater restrictions when looking for a job, they do so in worse conditions and with lower remuneration than their male peers. According to the ILO, the percentage deficit of the average salary of women compared to men’s has been reduced over time, but it has not been resolved. The inequality of remuneration per hour depending on gender, in some countries it is approximately 45%. [1: International Labor Organization. (2016). Women at work.]

The activity rate for women aged 14 to 29 is 29.8%, while for 30 to 64 years it is 57.9%, this difference can be attributed to the first group postponed its presence in the marketwork due to motherhood and care tasks and that at that age they are conducting their secondary, tertiary or university studies. And with respect to the second group, as the age of the children increases, its participation in the market increases, unlike what happens with men, their participation is independent of the age of the children.

Women who participate in the market are represented in private sectors and occupations. Its presence in primary or construction activities is low, the main sources of employment are paid domestic work, teaching and health services. Therefore, political measures must be promoted to improve gender equality in the work world, since the inclusion of women in economic life is also key to the growth of a country, so you must continue working to reinforceThe role of them within these markets, improving the conditions and opportunities they can access.

Another factor that influences the activity rate of our country is the complex work scenario for young people. Argentina does not have a good educational level, that makes them have a precarious insertion with respect to other social groups, are exposed to higher levels of economic and social uncertainty and find low quality and low -income jobs. Young people too, have a longer search period and unemployment rates higher than adults, perhaps because their job aspirations are incoherent with the reality of the labor market. This situation of inequality is further aggravated according to the social stratum to which they belong.

Youth unemployment is concentrated in the most vulnerable social groups: among young people are women and the least educated those most affected by unemployment. In turn, most unemployed young people come from limited homes, many of which are in poverty. This generates a vicious circle of intergenerational poverty transmission. [2: Ministry of Labor, Employment and Social Security. (2017). Diagnosis of youth unemployment. Buenos Aires. ]

There are different factors that participate in the activity rate of Argentina, it has the same or greater importance as the productivity of a country, so it is fundamental: to determine efficient measures to combat and/or counteract inflation, design policies that guaranteea level of higher education and provide the necessary tools for people to have the possibilities they deserve in the labor market. It will be essential that this market has the necessary instruments and the best existing technology to ensure the country a high level of productivity that improves people’s lives.


The activity rate in Argentina is influenced by various factors, mainly in 2020 it was largely affected by COVID-19, which caused alarming statistics. Leaving aside the unexpected pandemic, the most important causes in the fall of this variable are labor informality in the country, gender inequality in the labor market and the complex job insertion for young people.

I consider that for a country to grow, the participation of all its citizens is necessary. On the part of the State, its obligation is to provide a good educational level for all young people, regardless of the position they have in the social stratum. You must design and implement policies to improve labor conditions and opportunities, to benefit both employees and employees.

The inclusion of women in economic life is also key to growth, laws that promote female labor insertion must be implemented and contribute to more easily detecting discrimination of them.


  1. National Institute of Statistics and Census of the Argentine Republic. (2017). Year of decent work, health and safety of workers. Buenos Aires.
  2. National Institute of Statistics and Census of the Argentine Republic. (2020). Work and income: rates and socioeconomic indicators (EPH) second quarter of 2020. Buenos Aires.
  3. Ministry of Labor, Employment and Social Security. (2017). Diagnosis of youth unemployment. Buenos Aires.
  4. Ministry of Labor, Employment and Social Security. (2017). Women in the labor market. Buenos Aires.
  5. International Labor Organization. (2016). Women at work.
  6. Roberto, v. B. (2019). Activity rate. Obtained from https: //

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