Argentina’s new president, Javier Milei, has revealed plans to lay off an estimated 5,000 state employees hired this year before he took office, as part of wider efforts to slash government spending amid the backdrop of the country’s troubled economy.
Mr. Milei, an economist, signed a decree on Dec. 26 stating that his government won’t renew contracts for the thousands of government workers hired since Jan. 1, according to reports.
However, the decree, which was published in the Official Gazette, includes exceptions, such as in cases in which workers were hired as part of “quotas regulated by law or other types of special protections,” including those with disabilities and personnel who are considered “indispensable,” according to Spanish newspaper El Pais.
The decree also noted that other government contracts made before 2023 will also undergo an “exhaustive review” in the next 90 days, according to the publication.
Overall, Mr. Milei’s government estimates that more than 5,000 workers will lose their jobs, although the Association of State Workers (ATE), a workers union, anticipates some 7,000 employees could be affected.
Union Announces Planned Protests
In a statement on Dec. 26, ATE General Secretary Rodolfo Aguiar said the union planned to mobilize on Dec. 27 in various parts of the country to protest the decree.
“The workers in all cases perform tasks that are essential to guarantee the functioning of all areas of the state, regardless of the type of their contractual relationship,” Mr. Aguiar said.
The protests will include strikes, mobilizations, assemblies, and roadblocks, he added.
“We state officials are going to deepen our fight plan. We cannot be accused of attacking governance. It is clear that social peace is being broken by a government that intends to leave thousands of families on the streets. It is by being on the street that we are going to stop the government’s adjustments,” Mr. Aguiar said.
“If the government moves forward with these layoffs, workers and families will be directly affected, but indirectly, the entire community will be affected. In the state, any dismissal translates into a loss of rights for all our people,” he added.
Mr. Milei, 53, was inaugurated as Argentina’s president on Dec. 10 after defeating Sergio Massa, economy minister for Alberto Fernández’s socialist administration.
Era of ‘Peace and Prosperity’
During his first official speech, he vowed to bury what he described as “decades of failures, internal infighting, and senseless disputes” and embark on a new era of “peace and prosperity.”
He also warned Argentinians to prepare for an economic “shock” as a result of the various reforms he plans to introduce in the coming weeks and months, in an effort to transform Argentina’s struggling economy, stating there is “no possible alternative to the adjustments.”
“Neither is there a discussion between the shock and ‘gradualism’—first of all because experience shows that all ‘gradualist’ programs ended badly,” he added.
His comments come as inflation in Argentina has surged by 143 percent on an annual basis, with experts expecting it to reach about 200 percent by the end of the year.
The high cost of living and a surge in widespread looting and poverty is in part what led to Mr. Milei’s victory in the latest election, after many voters accused former leader Alberto Ángel Fernández of failing to take responsibility for the crippling downturn in the economy.
Along with reforming government spending and payrolls, Mr. Milei has also vowed to allow the privatization of state-owned media companies and state-run oil and gas firms such as oil giant YPF as a way to boost exports and investment in Argentina.
Additionally, his government had pledged to make cuts to energy and transportation subsidies and shut down some government ministries to rein in government spending.