Argentina Keeps Losing Jobs

[Dublin2BuenosAires]

Foreign capital by and large is going to run screaming in the other direction. Typically if you're a multi-national and looking to establish subsidiaries, you're going to look at a place with either low costs and ease of entry into the market or low regulation & ease of doing business (rarely do you find both) or a place that might not meet either of those criteria but is a big enough market that you put up with all the BS b/c you have no other choice (see China). Argentina meets none of those qualifications. Add in currency instability, onerous regs and laws and well, there isn't a lot of reason to open a biz here and there are a lot of good reasons to take existing business elsewhere (as in RRD's case).

Starting up your own small biz can be done here of course but the issue comes when you start hiring outside employees or when you start to want to grow.

I think the foreign multinational flight is largely exaggerated, so many firms saw it out and didn't up sticks in 2001, they aren't going now. New investment might not arrive, existing multinationals will trim and cut costs but they will not up sticks. Doing so generally means writing off large sums of money and making even larger severance payments, penalties on rental contracts etc. By and large, unless struggling internationally, most will wait and see in survival mode especially the year before an election.

 

[citygirl]

I was discussing multi-nationals opening here, not ones that are already here. As for taking existing biz elsewhere, most have been quietly doing it for the last few years. They're not closing down but they're not investing here either.

 

[JoeGillis]

Yes, you still have 30 billion, which is a disgrace for a G20 nation Matias! Argentina did one of the largest defaults in human history. It started back again with a clean slate after the default, no debt, and 12 years later what do you have to show for it? That you still have 30 billion left? And with only 30 billion in the bank you celebrate raising subsidios?
And you are counting on Vaca Muerta to get you out of the hole? Nothing exemplifies the craziness that is Argentina than betting the future of your highly dysfunctional country on a dead cow.

Camberiu, one couldn't ask for a better assessment!

 

[Dublin2BuenosAires]

I was discussing multi-nationals opening here, not ones that are already here. As for taking existing biz elsewhere, most have been quietly doing it for the last few years. They're not closing down but they're not investing here either.

Hence "survival mode", switching emphasis in the Lat Am region is fairly easy to predict based on the politics of the recipient country with the exception of specific opportunities (shale etc) which change the risk profile of the investment. Most mn's maintain a footprint here, few leave. Salaries are still far cheaper than Brasil (which has similarly ridiculous labour laws & crime issues), there are still cheap english speaking graduates available. Chile is more expensive and geographically and geologically challenged.

Colombia is the new star in the region and should be seen as BsAs main threat, however Colombian infastructure is not great either and the workforce not yet as educated and English speaking as their Argentine equivalents. Speaking from experience from inside a MN where Argentina is still the biggest in terms of turnover, albeit a flaming daily headache.

If I were an English teacher, I'd go to Bogota or Medellin.

 

[citygirl]

I don't think we are disagreeing.

I have talked with quite a few companies looking at Peru as a hub in SA.

 

[ajoknoblauch]

Which South American country is attracting expats with its economic opportunities? http://tinyurl.com/kgyaw4n

 

[ghost]

The commodities market threw Argentina the brass ring from heaven. Here you go, prices are going up, up and up and you're one of the worlds biggest farms. This is a slam dunk.....? Nope, Argentina found 10 ways to f...k up a sure thing. What makes anyone think it won't f..k up the next sure thing....Dead Cow will be DOA.

 

[fred mertz]

The RR Donnelley company was the largest magazine printer in Argentina. I think that the reason that they closed shop is because NO ONE BUYS MAGAZINES. When was the last time any of you bought a magazine? In Buenos Aires I would think that Gente and Hola still sell, but few others do. NO ONE READS MAGAZINES..Magazines make their money through advertising. In the states many magazines are sold by subscription. It was, very often, 12 magazines for $12.00 The way the economy is, companies aren't able to pay Sra. Gimenez a fortune to advertise a candy bar, the way that they had in the past.
I take about 4 major trips a year, each involving many different flights. I rarely see anyone read the free airline magazines. Many of them are quite good. If people spend most of their lives texting and on their movils, there is no time left for reading magazines or books. Look what happened to Borders. Barnes and Noble has closed most of their stores. Not too long ago, the Ramblas in Barcelona had many large newstands. They are no longer selling newspapers and magazines. They are now selling souvenirs. What happened in Argentina will be happening in the First World more sooner than later. I didn't get a television mini -mag with my Cablevision bill, this month. What will happen to all of the people who work in industries related to magazines?Watch the dominos fall. Very sad.
Times, they are a changing.



Times, they are a changing.

 

[Jaredberryman]

No one buys magazines, but people continue to read them on their devices. I read magazines everyday via Flipboard, as do millions of other people. People probably read more and are more informed than 20 years ago, it's just that the medium has changed and paper is now superfluous. This certainly hits printing businesses hard, but it's not necessarily a bad thing in the long run. I'll bet I read a ton more of information than my parents did at my age. Everyday I read through CNN, La Nacion, Clarin, Flipboard, etc. etc. et al. All of this on my phone or laptop. I didn't buy anything, but I did view Re-marketing ads and display ads. People don't read magazines on the airplanes because they have probably already downloaded content onto their Ipad and they can read it or view it instead of a magazine.

Some people that work in magazine industries are surviving because they continue to pedal their product in the right place -- digitally.

However, more worrisome than Donnelley closing is all the other small businesses that I have seen closing. It's not a good sign. When laundry mats, restaurants, kioscos, and then like are closing down, it means something is wrong at the micro-level. So we are starting to see the effects of the default and this government's decisions already on a daily basis. I don't think there will be a crash, but when people start losing jobs, it's a serious problem.

 

[Gringoboy]

And the flipside is interesting...
In my street where I have my PC shop, another shop closed mainly because it was ancient and run down. Someone else rented the place and has now opened a paper goods shop, literally this week.
A few doors away a trendy/sports clothing shop closed for a while and re-opened with new owners (buy-out) last month.
A few further doors away, the butcher closed, to be reopened as a fishmonger about 2 months ago.
Although it's difficult in the high street, there are still some glimmers of hope.