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AUN News is a leading media channel dedicated to delivering impactful information on public policy. We focus on amplifying the voices of deprived and marginalized stakeholders, ensuring inclusiveness in the policy-making process to achieve the United Nations Sustainable Development Goals (SDGs) .

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ECLAC and ILO emphasize the need to encourage public measures to revitalize the Region’s labour markets for the creation of high-quality jobs

Date:

  • news by AUN News correspondent
  • Monday, December 12, 2022
  • AUN News – ISSN: 2949-8090

Summary:

The coronavirus pandemic caused an unprecedented crisis in the economies and labour markets of Latin America and the Caribbean. The employment rate returned to its pre-crisis level in the second quarter of 2022. All of the countries under study saw a decline in the unemployment rate. ECLAC and the ILO say that effective development policies must be made more ambitious to stop this trend. This is because policies for product development have not sufficiently guided the structural transformation. Policies for effective development also require a sound macroeconomic and financial foundation.

The macroeconomic, social, and environmental conditions that Latin American and Caribbean economies are dealing with will impact labour market dynamics, according to a new joint report from the International Labor Organization (ILO) and the Economic Commission for Latin America and the Caribbean (ECLAC). Even though the job market got better in the first half of 2022, the institutions say that it is likely that the region’s ability to create high-quality jobs will slow in the second half as the GDP slows.

In the first part of issue No. 27 of their joint publication Employment Situation in Latin America and the Caribbean: Labour Productivity in Latin America, the United Nations organizations say that the coronavirus disease (COVID-19) pandemic caused an unprecedented crisis in the economies and labor markets of Latin America and the Caribbean. They stressed in earlier studies that the region’s labour markets have only slowly, partially, and unevenly recovered since economies have been restored. However, those markets’ key indicators showed positive changes in the first half of 2022.

The employment rate returned to its pre-crisis level in the second quarter of 2022, while the unemployment rate dropped by 2.8 percentage points from the same period in 2021 to 7.3%, below pre-pandemic levels. All of the countries under study saw a decline in the unemployment rate. The labour force participation rate also improved, though it is still below the level seen before the health crisis.

Another point made in the first section of the paper is that these encouraging developments are more pronounced among women, who were particularly hard hit by the epidemic and whose recovery took longer in 2021 than it did for men. Although the unemployment rate decreased for men and women in the first half of 2022 (by 2.3 and 3.4 percentage points, respectively), it did so for women much more quickly. As a result, the unemployment gap shrank from a ratio of 1.5 to 1.4 between the first half of 2021 and the same period in 2022.

According to the numbers, the manufacturing sector has seen the most job growth, and paid work has grown more than its own-account career in the first half of 2022. According to that part, the sharp rise in inflation in the year’s first half has caused average real wages to go down.

In the Employment Situation in Latin America and the Caribbean No. 27 report, ECLAC and the ILO also note that the region’s economies must overcome the slow productivity and investment growth that has been observed since the debt crisis, in addition to the challenges posed by the current labour market situation.

In the paper’s second half, I show how Latin America’s labour productivity has stayed the same since the 1980s. As a result, the region’s labour productivity gap with established economies has grown even more comprehensively than other developing economies. Contrary to what happens in other emerging economies, like those in Asia, the region has experienced widespread stagnation in labour productivity. This is because the structural transformation has not been sufficiently guided by policies for product development to stimulate growth-promoting industries.

ECLAC and the ILO say that to stop this trend and encourage the creation of more formal, well-paying jobs, productive development policies need to be made more ambitious while also taking into account new policy strategies for achieving this goal and the new realities brought on by the technological revolution and the new productive paradigms it is creating. Policies for effective development also require a sound macroeconomic and financial foundation. Lastly, these groups talk about how well social conversations have worked within the productivity councils set up in the area.

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