UPDATE 2-Argentina unemployment steady despite slowdown-president

Mon Jan 28, 2013 6:55pm EST

Related Topics

* Fernandez says economy grew 1.8 pct in 2012

* Official data won't be released until mid-February

* Gov't to raise income tax floor, pension benefits

BUENOS AIRES, Jan 28 (Reuters) - Argentina's unemployment rate was 6.9 percent in the fourth quarter, up just slightly from a year earlier even though economic growth slowed sharply, President Cristina Fernandez said on Monday.

In the fourth quarter of 2011, the jobless rate was 6.7 percent, according to the INDEC statistics institute.

"We are nearly at the same level of record unemployment that we reached in the last quarter of 2011," Fernandez said during a live televised speech.

"We have practically the same unemployment this year, when we're going to grow at 1.8 (percent), as we did when we grew at 8-plus percent."

INDEC is due to release official economic activity data for December and 2012, as well as the fourth-quarter unemployment figures, in mid-February. In 2011, the Argentine economy expanded 8.9 percent.

The president also announced the government will raise the floor for income tax eligibility by 20 percent, responding to demands from the country's labor unions.

Private economists estimate consumer inflation at around 25 percent a year, and wage increases have tended to be in line with that figure.

As of March 1, the new minimum salary for paying income tax will rise to 8,360 pesos ($1,681) a month for a single person, and 11,563 pesos ($2,325) for a married worker with two children. Fernandez said this would cost the state over 8 billion pesos in lost tax revenue.

The center-left leader also announced state pension benefits will rise 15 percent starting in March. By law, the government must raise pension payments twice a year using a formula that takes into account various economic and price variables.

The minimum pension payment will rise to 2,165 pesos a month, or roughly $435, which Fernandez said would help sustain aggregate demand.

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.