Employees of the Argentine company Visuar at work in the factory, in Province of Canuelas, in Buenos Aires. Economic conditions have forced many other companies to close. File Photo by Enrique Garcia Medina/EPA
More than 30 companies have been closing each day in Argentina for the past 1 1/2 years, with a net loss of more than 236,000 jobs, according to a report from the Center for Political Economy of Argentina based on official data from the Superintendence of Occupational Risks.
A few days ago, U.S.-based Whirlpool announced the dismissal of 220 workers after shutting down its plant in Pilar, on the northern outskirts of Buenos Aires. The plant is ceasing operations because of falling sales and competition from cheaper imported products, factors that made continued operations in the country unviable.
The company’s decision adds to a growing list of domestic and foreign firms that have stopped operating over the past 20 months. The wave of closures reflects the economic and structural challenges facing Argentina’s productive sectors, with a direct impact on formal employment and the country’s industrial capacity.
Hernán Letcher, director of the Center for Political Economy of Argentina, told UPI that public data show about 19,200 companies have closed since President Javier Milei took office, with an estimated average of 32 closures a day through August.
In addition to company closures, the economist tracks other labor conflicts, including mass layoffs and suspensions. He also noted firms in critical condition that have been forced to restructure production, along with cases of reorganization proceedings and bankruptcies.
Letcher said the sectors most affected are construction and industry.
“Construction is suffering because public works have been halted, while in industry the hardest-hit segments are automotive, textiles and footwear. Everything related to electronics and home appliances is also facing difficulties, partly because of lower tariffs,” he said.
The meatpacking sector is under severe strain, as is the dairy industry, while metallurgy and steel are in a “very complicated” situation. The paper and plastics industries are especially affected by increased imports.
Letcher attributed the industrial crisis to a combination of factors. One of them is the drop in purchasing power, which has reduced sales by about 10% on average, with sharper declines in certain sectors.
He said the second and most damaging factor is the opening of imports. The third is an exchange rate that is uncompetitive for industrial production.
“It’s no longer a cost problem tied to logistics or taxes, which probably also play a role, but the appreciation of the peso makes industry unviable in many segments,” he said.
As a fourth factor, Letcher pointed to rising public utility rates. He said the sharp initial increases in electricity and gas at the start of Milei’s administration significantly raised costs, and that under current conditions rates are once again pressuring companies.
Finally, he criticized the absence of financing and industrial promotion policies.
“All industrial policy has been dismantled. The small and medium-sized enterprise secretariat no longer exists and the Industry Secretariat saw its funding cut by about 85%,” he said.
Daniel Rosato, president of Industriales Pymes Argentinos, offered a similar view, telling UPI that the industrial sector is now facing a critical situation.
“Argentina is expensive in dollars. We have a high tax burden, elevated energy costs, no access to financing and labor charges that are far higher than in other countries,” he said.
According to Rosato, that cost structure, combined with what he called an “indiscriminate opening to unfair imports” — especially from China, where many machines and equipment arrive with subsidized prices — prevents domestic companies from competing.
“That situation translates into layoffs, plant closures and a drop in domestic consumption, in a context where workers have already lost purchasing power,” he said.
Rosato said the domestic market has been deteriorating steadily, both in mass consumption and in sectors such as capital goods and home appliances, which also cannot compete with imported products.
“Even domestic steel manufacturers are calling for measures against unfair imports,” he said.
Rosato said the problem affects both large and small companies, although smaller firms are the most exposed because they lack financial backing.
He said the government has shown no interest in supporting industry, saving companies or taking steps to prevent closures and job losses.
“There are no measures and no dialogue. We want a solution because some companies are struggling badly. If no action is taken, there is a risk that more companies will be forced to close,” he said.
