In a recent speech to Congress, President Javier Milei claimed that ten million people had been lifted out of poverty during his administration. He cited data from institutions such as the Universidad Torcuato Di Tella and the Universidad Católica Argentina (UCA), explaining that poverty "on a biannual frequency, fell from 56 percent to 33 percent."
However, UCA's prestigious Observatorio de la Deuda Social (Social Debt Observatory of the Catholic University of Argentina, ODSA-UCA) puts these results into perspective: poverty has indeed fallen, but only to the levels of 2023, after a significant rise in the first quarter of 2024.
For the poverty watchdog, consumption levels and saving capacity do not align with a meaningful reduction in poverty. When considering other factors such as food security, access to healthcare, decent employment, education, public services, and housing, "the current picture is different: multidimensional poverty increased year-on-year from 39.8 percent to 41.6 percent," said ODSA-UCA in a recent study.
The government’s official poverty calculation, tracked by the INDEC national statistics bureau, "measures household income and whether it is sufficient to cover the cost of a basic basket of goods," explained Juan Ignacio Bonfiglio, a researcher at the institution. However, “it may be that a household's income surpasses the poverty or extreme poverty threshold, but those earnings still do not allow the household to eat properly, afford medication, or receive adequate healthcare,” warned the experts. “These are some of the components considered when defining multidimensional poverty."
The ODSA-UCA report, titled 'Social debts on the waiting list: Social balance 2024,' indicates that while poverty and extreme poverty rates reached 38.3 percent and 9.2 percent respectively in the third quarter of 2024, "there are reasons to believe these figures are overestimated."
If poverty is measured by income, Bonfiglio continued, "when there is strong volatility, as we have seen since mid-2023 and in the early months of 2024, short-term distortions can lead to a sharp rise in poverty, potentially overstating the increase.”
“When this process stabilises, as has now happened, the poverty rate may appear to decline significantly,” the expert told Perfil. “The drop in poverty, according to available data projections, could also be overstated."
Amid a context of the devaluation of the peso, removal of price controls and budget-slashing austerity measures, the UCA report explains "poverty increased year-on-year from 38.7 percent to 54.9 percent, while extreme poverty rose from 8.9 percent to 20.3 percent." These surges are used as reference points to present a subsequent decline in the indicators.
"A structural floor of chronic poverty remains, difficult to break without more and better jobs with improved wages, especially for poor informal workers," the report details. However, the number of “working poor” (those below poverty line with formal jobs) increased: the third quarter of 2024 closed with an average of 29 percent (nearly one percentage point higher than the same period in 2023, when it stood at 28.1 percent), after peaking at 44.6 percent in the first quarter of 2024.
According to data from INDEC, the proportion of workers without pension contributions increased from 35.8 percent in the third quarter of 2023 to 36.7 percent in the same period of 2024.
On this point, the UCA states that "it is worth noting a return to pre-austerity crisis unemployment levels as a result of an increase in employment, albeit mostly informal and more precarious."
It concludes: "Statistical poverty and extreme poverty levels in the third quarter of 2024 were similar to those of the third quarter of 2023, and even with expectations that the biannual average for 2024 will be lower than that of the previous year's final semester," paradoxically, "mass consumption levels do not seem to reflect this trend."
The report concludes that structural deprivation has also worsened. "A crucial aspect is that the disproportionate rise in public service costs has increased the burden of fixed household expenses over variable expenses,” it reads.
This explains why, "despite similar poverty and extreme poverty levels to a year ago,” problems like “multidimensional poverty, food insecurity, lack of access to medication or healthcare services, unpaid debts and the inability to repair homes have continued to rise."
"We can question the real impact of the decline in poverty. There remain several aspects that are still severely lagging. We need a long-term analysis to determine whether, as the macroeconomic crisis subsides, this translates into a genuine improvement in people's living standards," said Bonfiglio.
Data from the UCA’s social statistics platform shows that children and adolescents, aged 0 to 17, have been the most affected by ongoing economic turmoil. Child poverty reached 65.5 percent in the third quarter of 2024 – the highest level in 20 years, according to UCA data. In 2005, the level stood at 67.5 percent; for comparison, the lowest level was in 2011, at 35.7 percent. From that point on, it has risen.
The percentage of people experiencing food insecurity also increased, rising from 32.2 percent to 35.5% between the fourth quarter of 2023 and the same period in 2024. UCA defines this as the proportion of children and adolescents living in households "where food consumption has been reduced in the past 12 months due to economic difficulties."
However, one indicator that showed improvement was child labour, which declined from 9.5 percent in 2023 to 8.8 percent in 2024.
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