The higher the informality, the lower the confinement - IDESA


Report Nº: 85507/04/2020

The higher the informality, the lower the confinement

People’s chances of complying with confinement are very different. The chaos of retirees and welfare recipients crowded in banks and the lower compliance among informal workers demonstrates this. There is an urgent need of flexibility in confinement to allow people to go work, taking care of themselves and others.

Amidst strict rules of isolation, retirees and welfare recipients crowded in at the banks’ doors to collect their benefits. It is a grave contradiction that while many young people are deprived of going to work and study, at enormous productive and social costs, a large number of people highly vulnerable to the virus, such as older adults, are set off to the street.

Beyond the officials’ responsibilities, there are more fundamental underlining factors. On the one hand, it reveals the obsolescence of a cash-driven payment system. It also highlights the consequences of running hundreds of overlapping welfare programs. Finally, it is a palpable manifestation of the unfeasibility to continue extending confinement at the current level of rigidity.

It is difficult to measure the level of confinement compliance. But information published by the company Google on mobility to workplaces combined with INDEC data on the labor market shed light on the issue. According to these sources, it can be seen that:

  • In CABA and the southern provinces, where only 30% work informally, 66% were absent from work due to confinement.
  • In the provinces of the Central region, where informality is 48%, absenteeism due to confinement drops to 59%.
  • In the Northern provinces, where the incidence of informality reaches 53%, only 46% were absent from work due to confinement.

This data is very suggestive. In regions with a lower incidence of informality (non-professional self-employed and unregistered salaried), two-thirds of workers complied with confinement. In the north of the country, on the other hand, where informality is massive, less than half complied.  Additionally, it should be noted that in the north the proportion of public employees is high, whose tendency to comply with confinement is higher. So, among the informal in the north, confinement violation would be massive.

This evidence points out that extending isolation with the current rigidity will lead to a spontaneous and anarchic deconfinement like that of pensions. It should not be overlooked that half of Argentina’s workers are informal and, for the vast majority, not working means running out of income for their family’s subsistence. A labor market and obedience to confinement vision, biased by the reality of the City of Buenos Aires, leads to ignoring that in the interior, there are different possibilities to comply with the isolation.

The labor and social situation of the whole country marks the importance of swiftly advance towards an ordered flexibilization. In the case of informal workers, a mechanism of authorization managed through the Internet could be contemplated under the commitment to comply with prevention norms. For formal workers, employers should prioritize home office and, when not possible, organize the work respecting distances and cleanliness. Individual recreation activities such as walking, running, and cycling should also be made possible. It is not a question of relaxing the struggle against the pandemic but of moving from a first phase –more driven by panic than by reasoning– to another stage of responsible behavior where people take care of themselves and others, respecting the rules of physical distance.

But the most important conclusion from the unfortunate fact of exposing the elderly on the street to contagion is the disorder in the public sector operation. Not only because it preserves an obsolete payment system but also because it accumulates hundreds of social programs, at the three levels of government, whose main result is to feed bureaucracy and clientelism. It seems far away, but just two months ago, poor people were massively summoned to give them a Food Card. When it would have been much fairer and efficient, a bank transfer to the account where they already receive other welfare payments.

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