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Industry, the name of the economic future of Argentina

The current technological revolution creates, destroys and transforms work, all at once. At unusual speed, the Industry 4.0 race is redesigning economic relations between countries. What do we have to do? In principle, direct each decision of public policy to enhance our capacity to generate, improve and transform employment.

The developed world (and the one that seeks to develop) does not doubt: governments took the post to boost the race with the private sector and the world of knowledge. Manufacturing USA, Made in China 2025, UK’s Industrial Strategy, Piano Nazionale Impresa 4.0, Make in India … are some of the names of the policies launched in recent years.

Although each one with its particularity, these programs have some common elements: technology adoption, heavy investment in Research and Development (R & D), digital labor training, high-risk public investment, and preferential public procurement systems for national actors .

In the G20 of Buenos Aires – and in the B20 in which I had to act as sherpa – we saw clearly how these strategies are reflected in the positions of the governments before the problems of the multilateral agenda. A few weeks ago, in a joint manifesto, Germany and France put the dilemma in black and white: “The choice is simple when it comes to industrial policy: we join forces or allow our industrial base and capacity to gradually disappear.”

By itself, technology is revolutionizing production. With the explicit impulse of the main governments of the world, speed multiplies. For countries like Argentina, the dilemma is even more acute: closing is not an option; But getting ready to compete with titans who want to stay on the podium is a major task.

If we do not want to remain (very) behind in this process, if we want the country to have a chance to overcome the primarized structure that has historically slowed the development of our economy, we have to move quickly. And doing so requires broad agreements on some central points, in terms of allocation of resources, training of our human capital and redesign of the credit and tax structure.

Investing more and better in R & D is a necessary condition for this process. Today we have a budget of just 0.53% of GDP, well below developed countries (Germany, for example, invests almost 3%) and half of what Brazil invests.

But it is also key to prepare ourselves in terms of training, adaptation and training for the new world of work. Our heterogeneous productive structure, with very uneven levels of productivity, comes hand in hand with a labor market where four out of every 10 people have problems of unemployment or labor informality. And a significant number have problems of employability, that is, they do not have the minimum knowledge or skills to perform in the positions that exist or will exist.

Not necessarily robotization destroys employment. What we see in many plants is that technology generates new jobs, less mechanized but that require more knowledge. And that the growth that generates the highest productivity can increase the absolute number of positions.

For example in Industrias Guidi, our autoparts with almost six decades of history, between 2014 and 2018 we almost doubled the production in the welding area, among other things, thanks to the automation of almost 100% of the process with the incorporation of 49 robots . But at the same time we increased employment by 50%, adding also new roles linked to the monitoring and real-time monitoring of production.

These changes require a modernization, not only of technology but also of our practices, institutions and economic relations. There is much to be done, such as access to credit for a productive investment that allows for quantum leaps in productivity; or the improvement of framework agreements that guide labor relations, which average for half a century, and encompass generic activities that do not contemplate the specificity of each sector nor give rise to the dynamism of current productive tasks.

Moving forward on this agenda is not an option for our generation but a mandate to overcome the country’s historical tensions. Every day we see in our plants that Argentina has difficulties, but that it starts from an important industrial tradition. That is a privilege that we only have a handful of countries: a strong technical background in entrepreneurs and workers, and a will to grow, innovate and create on that tradition.

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