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UNIDO Data Reveals Significant Contraction, Particularly Affecting SMEs
The United Nations Industrial Development Organization (UNIDO) has reported that Argentina experienced the most significant industrial decline among 79 countries in 2024. The country’s industrial output contracted by an average of 9.4% last year compared to the previous period.
The analysis of this information comes from Misión Productiva, a network of professionals focused on promoting discussion about development, production, innovation, and quality employment. The data is derived from UNIDO’s global monitoring of industrial variations, where Argentina’s average was “the worst recorded among economies from different regions of the world.”
Significant Sector Contractions
The report highlighted profound decreases in several sectors, including non-metallic minerals (-24.3%), furniture and other manufactures (-18.6%), and machinery and equipment (-18.6%). The only sector that showed positive growth was oil refining, which expanded by 2% during the year.
The decline in domestic demand, driven by a loss of real wages, especially in the first half of the year, and the contraction of activities that traditionally boost industry, such as construction, pushed the sector into recession.
SME Production and Employment Hit Hard
According to the latest report from the Fundación Observatorio Pyme (SME Observatory Foundation), 2024 concluded with a 10% decrease in production and a 6% fall in employment levels for small and medium-sized enterprises. This was described as “the second-largest drop in production after the pandemic and also the second-largest drop in employment, only surpassed by the decline in 2009 during the international crisis.”
Competitive Shock for Manufacturing SMEs
Based on its quarterly survey, Observatorio Pyme warns that “manufacturing SMEs are facing a competitive shock generated by the currency appreciation process, import liberalization, and measures that promote imports without the same incentives for local production.” This situation raises concerns “about the process of job destruction and the loss of productive capacities.”
The results are from the Observatorio Pyme’s Q4 2024 Economic Survey, conducted in February 2025 with a sample of 500 companies from two contrasting sectors within the SME segment: manufacturing and software.
The report noted a “dual behavior throughout 2024 between manufacturing SMEs and those in software and IT services. While the recession impacted the manufacturing segment, software companies saw continued activity growth. With their nuances, both sectors showed better performance in the second half of the year than in the first: a smaller decline for manufacturing and a larger increase for software.”
Resumen en Español:
La Organización de las Naciones Unidas para el Desarrollo Industrial (Onudi) advirtió que Argentina registró la mayor caída industrial en 2024 entre 79 países, con una contracción promedio del 9,4%. Sectores como minerales no metálicos, muebles y maquinaria sufrieron bajas significativas. La caída de la demanda interna y la contracción de la construcción fueron factores clave. El Observatorio Pyme reportó una disminución del 10% en la producción y del 6% en el empleo en las pymes manufactureras, la segunda mayor caída desde la pandemia. Advierten sobre un shock competitivo debido a la apreciación cambiaria y la apertura importadora, con riesgo de pérdida de empleos y capacidades productivas.
Resumo em Português:
A Organização das Nações Unidas para o Desenvolvimento Industrial (Onudi) alertou que a Argentina registrou a maior queda industrial em 2024 entre 79 países, com uma contração média de 9,4%. Setores como minerais não metálicos, móveis e maquinário sofreram quedas significativas. A queda da demanda interna e a contração da construção foram fatores chave. O Observatorio Pyme reportou uma diminuição de 10% na produção e de 6% no emprego nas PMEs manufatureiras, a segunda maior queda desde a pandemia. Eles alertam sobre um choque competitivo devido à apreciação cambial e à abertura importadora, com risco de perda de empregos e capacidades produtivas.
