Nearshore Americas

In Argentina, Even Software Devs Can’t Escape Inflation Insanity

Pedro Benzina would be considered one lucky man in Argentina. His profession –software development– ranks amongst the highest paid in the country. If positioned correctly, he could work for transnational companies, earn double the salary of most Argentineans and, fortune permitting, receive his paycheck in US dollars.

But not even Mr. Benzina can escape the terrors of Argentina’s most prevalent economic boogieman: inflation.

“I don’t pay rent, but the very fact of going to the supermarket and paying more and more each day for less and less weighs on us all, whether you’re a programmer or not,” Benzina told NSAM. “A programmer will feel the effects [of inflation] no matter the salary; it shows in our bottom line. It hits us mostly in our ability to save money.” 

Mr. Benzina’s story is not unique. Colleagues of his have been feeling the squeeze too as inflation climbs at breakneck speed, threatening the finances of even a group of professionals considered among the most privileged in all of Latin America.

Inflation in Argentina closed December of 2023 reaching an eye-popping 211% increase (year-over-over), a three decade high. Food prices saw a 251% leap, with housing (159%), healthcare (227%), transportation (187%) and communications (185%) registering exorbitant jumps too.

NSAM spoke with several programmers and software developers based in Argentina about how price hikes have impacted their personal finances. Most of them preferred to remain anonymous for fear of angering the companies they’re currently working for. Nevertheless, their testimony illustrates the heavy blows dealt by inflation throughout the country’s economic spectrum. 


Feeling the squeeze

“It’s way tougher than before,” an Argentinean dev told NSAM when asked about his financial situation. 

“We’re getting paid in [Argentinean] pesos, and the company is on the brink of bankruptcy,” he continued. “We’re way behind inflation, and using the US dollar as a reference, I’m about 30% below [financially] where I was last year. Plus, anything paid in dollars is way more expensive. My purchasing power has fallen sharply”.

“We’re way behind inflation, and using the US dollar as a reference, I’m about 30% below [financially] where I was last year”

The Argentinean peso suffered a 54% collapse in mid-December of 2023, the result of a devaluation strategy implemented by the administration of newly elected president Javier Milei. In July of 2023, a single dollar could be bought with around 500 pesos. By late January of 2024, the exchange rate stood at 800 pesos for every dollar.

The recent history of devaluation of Argentina’s peso has been eating away at the pockets of developers who get paid in national currency.  In July 2023, the average salary for a software developer in Argentina was 555,000 pesos a month, according to the country’s software industry Chamber. That salary was equivalent then to over US$1,000. In January 2024, it amounts to US$650.


What’s to be done?

Several of the devs interviewed for this article sourly noted that their best options at the moment are either asking for a raise, working directly for companies in the US or requesting to get paid in dollars. 

“I work [computer] systems at an Argentinean company, and it’s kind of heavy,” one of the devs commented. “If I want to catch up with inflation, they would have to increase my salary by about 50%. That’s not going to happen.” 

“My salary saw no changes due to inflation, even when the company increased rates for clients, and in US dollars,” said another one. “They laid off a bunch [of developers], and all of that workload fell on our shoulders. Even if salaries kept pace with inflation, you still have the pressures of extra work from those who were fired. You lose either way.”

It’s been reported that some of the bigger tech firms in Argentina –Globant, Despegar, Ualá and Mercado Libre– offer partial payments in dollars to some of their senior staff. Nevertheless, those count as the exception, not the rule. 

“Even if salaries kept pace with inflation, you still have the pressures of extra work from those who were fired. You lose either way”

There’s also the possibility of freelancing directly for companies in the US or Europe. Gig platforms like Toptal, Upwork, Tecla and provide a shot at remote, short-term contracts paid in valuable currency. But competition is growing more intense by the day thanks to the global reach of such platforms. 

Back in Argentina, the landscape is not that different. In spite of growing demand, there’s a lot of competition for IT work in the country, a situation hitting juniors and freshers the hardest. 

“Due to saturation, salaries aren’t as good as they used to be,” said an interviewee. “The last guy we hired, who’s quite knowledgeable for a junior, accepted 375,000 pesos [US$450] in December 2023. He had no other choice.”


Tightening the belt?

Most Argentinean progrramers haven’t felt pressured to make radical changes to their lifestyle. Their salaries are still high enough to allow for a comfortable or even lavish living, even if their pockets are being drained at a faster rate.

Some, however, expressed concern over their savings. As noted by Mr. Benzina, fat paychecks haven’t been able to distract Argentinean IT workers from the creeping threat of inflation. Prices keep climbing, eroding their earnings and, in a way, their efforts. 

“I still go out and stuff, like I normally would, but I haven’t been able to save as much as before,” one of the devs said. “I pretend everything’s fine and stick to my standard of living. I would rather enjoy my money now and save it later, when things feel more stable.” 

Argentina is no stranger to economic chaos. The country has spent over a decade dealing with heavy debt, middling economic performance and prices spiraling out of control. Yet, the latest wave of turmoil was brought on by the painful policies of President Javier Milei. 

A controversial figure, Milei pledged to turn Argentina’s fortunes around through what has been termed “shock therapy” by local media. The name illustrates policies that have been sold as radical and aching in nature, yet necessary due to the country’s current situation. 

Economic analysts remain doubtful about President Milei’s strategy, but a handful of entrepreneurs –several of them top players in the tech game– have shown themselves willing to give Milei a shot.  

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It will be a while before the effects of President Milei’s policies make their full impact. In the meantime, Argentineans of all walks of life have to keep dealing with one of Latin America’s most chaotic economies. 

The burden isn’t as heavy for most IT workers in the country. However, they can’t help but feel the pressure in their pockets and look for other avenues. In a region which loses many of its most promising, young minds to brain drain, that’s a cause for concern. 

Cesar Cantu

Cesar is the Managing Editor of Nearshore Americas. He's a journalist based in Mexico City, with experience covering foreign trade policy, agribusiness and the food industry in Mexico and Latin America.

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