Globe, Latin America, United Kingdom

Rising unemployment rides over Latin America

The arrival of Covid-19 had a deep impact in Latin America, destroying and causing instability in employment with the constant increase of unemployment, a problem that had been dragging on for years.

 

Teyuné Díaz Díaz

 

In the region, great wealth coexists with wide structural gaps, slow economic growth, inequalities, extreme poverty and high levels of unemployment.

All those were accentuated by the existing global health crisis.

In 2018, the Economic Commission for Latin America and the Caribbean (ECLAC) warned about the ongoing deterioration of the employment market and demonstrated that the employment rate increased by only 0.1% after five years of stagnation. But the Latin American employment landscape worsened with the difficult health and economic crisis created by Covid-19.

According to a recent joint report by ECLAC and the International Labour Organisation (ILO), the employment market presents important challenges in the short-to-medium-term.

This path will depend, among others, on the effectiveness and massification of disease control measures and the strength of the economic recovery which is surrounded by the frailty for the production sector, the text adds.

On one hand, the regional Gross Internal Product shrank by 7.1% – the highest in the last century -, the employment fell by 5.5% and participation by 4.5%, while the unemployment rate reached 10.5%.

In addition, Latin America has the highest decrease in working hours in the world, with an estimated loss of 16.2% compared to 2019, a figure that almost doubles the 8.8% at global level. The most affected groups were young people, workers in the informal sector and women, the document informs.

The research warns that as of 2021, the region could experience higher unemployment rates with a tendency to stay the same and that there is a chance the formal jobs created, and female labour will not recover pre-pandemic levels in the short-term.

Both international organisations highlight the need to promote public and private investment in the sectors most affected in each country in order to reactivate the production sector and speed up labour demand.

This is a goal for governmental policies and labour institutions if the economic recovery is not accompanied by social and labour programmes that guarantee workers’ protection. (PL)

(Translated by Cristina Popa – Email: gcpopa83@gmail.com) – Photos: Pixabay

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