Photo via Politica Argentina

The government kicked off a program that hopes to encourage businesses to employ welfare recipients today. The plan uses money government beneficaries had been receiving and combines it with their new salary should they get hired for up to 24 months. This way, the public and private sector would split the salary of the worker, in an attempt to reduce unemployment and, in the longer term, reducing funds the State allocates to welfare programs.

In fact, the Macri administration will destine 40 percent of its annual budget to them. The argument, then, is that if they manage to get companies to start growing and profit enough to pay the workers’ complete salary after two years, then it’s a win-win situation.

“There’s nothing more important for my administration than increasing employment for Argentines,” said Macri when announcing the initiative in an event to commemorate a new anniversary of Labor Day on Monday.

According to decree 304/2017, published today in the Official Bulletin,  the project would reach recipients of welfare programs instated by the Social Development ministry who “become employed in the private sector.”

“The employers who are interested in accessing the economic incentive for the employment of recipients will have to apply to incorporate the workers they hire,” the decree adds.

Businesses employing recipients but doing so within the informal economy (i.e paying employees under the table) will also be able to access the benefit if they put them on the books officially. This could very well happen in several cases: if workers are not on the books, the Social Development Ministry really doesn’t have a way of knowing they don’t qualify to receive an allowance. As a result of this, many people take precarious jobs they combine with the plan to try to make ends meet. In an attempt to put an end to  — or at least reduce — informal employment, the government will continue giving the recipients the allowance if their employers bring them to the formal sector.

According to Clarín, the initiative would reach roughly a million people who receive allowances that go from AR $900 to AR $4,000. This last figure is practically half of a minimum salary in Argentina, which in January went up to AR $8,060.