Argentina Unemployment Shows Clock Is Ticking on Macri’s Reforms

(Bloomberg) -- President Mauricio Macri’s deregulation of the Argentine economy has cost more jobs than economists had expected, according to the first labor market report released since the new government came to office in December.

The unemployment rate was 9.3 percent, the statistics agency said in a statement handed to reporters in Buenos Aires Tuesday, compared with the median estimate of 8.3 percent in a Bloomberg survey of five economists. The government has dismissed labor market reports by the previous administration of Cristina Fernandez de Kirchner as unreliable.

“It is obvious that we have a serious situation in the labor market,” said Jorge Todesca, head the statistics agency.

Macri has slashed subsidies, devalued the peso and fired some public employees to narrow the budget gap, while traveling the world to drum up investment and stave off a slump in living standards. Today’s numbers indicate he may not have as much time as he hoped as labor unions step up protests against alleged dismissals. The president, who originally forecast the economy would return to growth in the second half, now says it may not happen until the first quarter of 2017.

The latest jobless number also highlights Macri’s attempt to regain investor confidence in Argentina’s economic data. Macri hired Todesca to head the statistical agency and tasked him with reviewing and creating new indices for gross domestic product, inflation and unemployment after the International Monetary Fund sanctioned Argentina for manipulation of the statistics from 2008 to 2013.

So far, Todesca has put out new GDP figures that showed a recession that deepened this year and inflation that was running at 4.2 percent a month in May.