Protective measures against the pandemic have negatively impacted the level of economic activity and associated social indicators. Since April, debating whether a negative shock was going to occur in the economy quickly stopped being a discussion and became an anecdote without much meaning.

In any case, and given the inevitability of the effects, the issues that really matter became: how deeply does this shock impact, what sectors of the population will be the most affected, what will be the perseverance of its consequences, what was the trajectory of the country and, above all, what to do.

The report that accompanies this article analyzes the data for the first quarter of 2020 provided by the EPH, complemented by the record of the technical report “Labor market. Rates and socioeconomic indicators (EPH)”, which provides information for the second quarter of 2020, and which anticipates the notable drop in activity in the labor market, especially that referred to the Gran Rosario Agglomerate.

It is presented with the belief that having a complete and unbiased overview of a set of socio-economic indicators of Rosario and Argentina will allow an improvement in the public debate on the effects of the pandemic. Effects that will be fully reflected, with the publication of the microdata base corresponding to the second quarter of 2020, scheduled for next November 6.

So, what can you expect from a 2020 labor market and social indicators report? The report presents an analysis of 4 main points: activity and employment, level of education, income and inequality measures. Both for the total of urban agglomerations, and in particular for the Gran Rosario agglomerate. In this article, a summary of the main ideas.

Activity and employment

The set of indicators referring to the composition of Argentina's economically active population show an extremely delicate situation. The open unemployment rate reaches a level of 13,1% in the second quarter of 2020, which represents an increase of 2,4 pp compared to 2019.

The discouragement effect operates on the general activity rate, which, in the second quarter of 2020, decreased 9,3 pp compared to the same period in 2019, standing at 38,4%. There is also a drop in pressure on the labor market of 3,1 pp year-on-year. In the AGR, the decrease in the activity rate was 16,2 pp year-on-year, but it still allows it to be located at a level of 43%, higher than the total for urban agglomerations.

education level

In Argentina, confinement measures have seriously affected the capacity of the educational system to respond to the needs of the reference population, as well as the capacity of families to appropriate the available solutions.

The results will undoubtedly be varied, but with a bias in favor of families with greater income capacity and, therefore, better access to remote education for young family members. In other words, if education is usually considered a means of upward social mobility, this year's results will most likely have the opposite effect.

The data show that the higher the level of formal education, the greater the chances of being active and employed; and the chances of finding yourself unemployed or demanding some improvement within the workplace are lower. At the same time there are greater chances of having a formal job and a public job.

In Argentina, the proportion of the urban population over 17 years of age with a low educational level is 40,2%. At the other extreme, the proportion of the population with completed university studies (or higher) is 10,44%. In the AGR, the population with a low educational level reaches a proportion of 43,07%. If we take into account the greater composition of the young population that the AGR has in relative terms, everything seems to indicate that the problems of first employment and youth employment will worsen during and after the pandemic.

Revenue

In Argentina, the real average family income reports a drop of more than 15% in a period of only 3 years. In nominal terms, the average family income for the first quarter of 2020 reached approximately $60.000, an amount that is enough to cover the purchase of 1,42 total basic baskets.

The existing gender differences translate into differences in average individual income between men and women. In Argentina, the largest gaps occurred in even quarters, with maximum levels of 50%. However, the first quarter of 2020 marked the smallest gap at the level of 33%, given by a decrease in income reported by men and an increase in income reported by women.

Measures of inequality

To measure income distribution, the Gini coefficient will be used. This indicator is based on the Lorenz Curve, and takes values ​​between 0 and 1. If it presented a value of 0, it would mean that that society obtained a level of absolute equality. While if it has a value of 1 it should be interpreted as that a single person takes all the income.

For the I quarter of 2020, the income distribution in the AGR presents a Gini coefficient of 0,4105, while the total of urban agglomerations reports 0,441. In the Lorenz Curve, although it cannot be seen in the graph, at the lowest levels of accumulated population, it is the national aggregate that is most equitable. For example, taking the accumulated 20% of people with the lowest income level, they accumulate 4,35% of the total income at the country level, but 4,23% in the AGR.

As a greater amount of population accumulates (for example, at 80%), the Lorenz curves of Argentina and AGR tend to separate, showing that the greatest differentiation occurs due to high incomes.

Conclusions

The pandemic caused a negative and asymmetric shock, which affects vulnerable people to a greater extent, but also young people. Unlike the other groups that are named in the report, this seems to be a segment with low political representation and, therefore, with low negotiation capacity.

One of the points that seems practically absent from the agenda for the first half of the year are the consequences of the closure of educational establishments at all levels as a preventive measure. To date, the health criterion has dominated the socio-economic criterion. The conditions prior to the greatest impact of the effects of the pandemic show that the starting point was already compromised in terms of activity, employment and income.

The reactivation will come in the future. But in the future, if the effects persist, younger people will have fewer tools at their disposal.