Argentina's poverty rate climbs to 32.3% as Milei faces economic hurdles
Argentina's poverty rate rose to 32.3% in the first half of 2026, up from 28.2% in the previous period. Extreme poverty also increased to 7.5%. The National Statistics Agency, Indec, released these figures, highlighting the impact of rising inflation and job insecurity. President Javier Milei's policies have led to increased foreign competition and company closures. Economist Eduardo Donza points to job insecurity as a major factor.
Foto: Angelica Reyes / Unsplash
Argentina's poverty rate has risen to 32.3% in the first half of 2026, based on data from the national statistics agency Indec released on Thursday. This marks an increase from 28.2% in the latter half of 2025. Extreme poverty also increased, reaching 7.5% from the previous 6.3%.
Indec attributes the rise in poverty levels to incomes lagging behind escalating prices. The agency defines poverty as the inability to afford basic goods and services costing $340, while extreme poverty is marked by the inability to afford a $150 food-only basket. These developments pose a significant challenge for President Javier Milei, a proponent of free-market policies.
Initially, under Milei's leadership, poverty rates nearly halved due to a reduction in high inflation. In the first half of 2024, the poverty rate stood at 52.9%, which decreased to 28.2% by the end of 2025. However, this year's increase coincides with a resurgence in inflation, even though it fell to 1.7% in August, the lowest in 14 months.
Eduardo Donza, a researcher at the Argentine Catholic University (UCA), pointed to job insecurity as a major contributor to the high poverty rates. "The biggest problem is job insecurity, not unemployment," Donza noted, highlighting that many families resort to makeshift jobs like waste collecting and street vending. The manufacturing and retail sectors have suffered significant job losses, driven by declining purchasing power and heightened foreign competition, outcomes of Milei's policies.
Since President Milei took office, about 30,000 companies have shut down, and unemployment has risen to 7.9% in the second quarter of 2026, the highest level since 2021. Economists argue that informal work is a more substantial driver of poverty than unemployment itself.
President Milei has claimed responsibility for lifting 14 million people out of poverty, citing the decline from the poverty peak after his inauguration. Nonetheless, the recent setbacks highlight ongoing economic challenges as Argentina continues to grapple with inflation and job market instability.
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