ABSTRACT
The constitutional government of Argentina has inherited the worst economic crisis in the country's history. This chapter summarizes the economic situation at the time when the new authorities took over. The share of wages in national income fell from 50% in 1974 to 35% in 1983. This is partly explained by a transfer of wage-earners to self-employment. According to household surveys, between 1974 and 1982 self-employment increased from 18-22% of the total working population. The labour market changed substantially between 1976 and 1983. Apart from the increase in self-employment, there was a rapid increase in the number of pensioners. Industrial employment fell sharply. The supply of marginal labour diminished with the fall in real wages, since they became insufficient to offset the costs of travelling to work and of seeking employment. Employment in the public sector for that period was approximately 1.8 million, that is to say, about 20% of the work-force.
