MercoPress. South Atlantic News Agency

Punta Arenas: Concern with growing unemployment.

The Punta Arenas Production and Commerce Confederation (CPC) described the latest report on jobs and unemployment in Magallanes Region as “worrisome”.

According to the latest release from the Chilean Labour Department unemployment in Magallanes Region in the October-December quarter remained steady at 7,2%, the highest in six years.

"Our preliminary reaction is that according to these unemployment numbers, production in the region, far from increasing tends to remain stable or diminish", said CPC president Ivan Nikovic. "When regional production should be increasing because of what we presume is greater dynamism in farming, commerce, tourism and fishing, exactly the opposite happens and this is very worrisome", added Mr. Nikovic.

The 7,2% is higher than the 6,5% of the October-December 2003 quarter and reverses the traditional tendency in Magallanes Region of falling unemployment in spring and summer. With these latest figures, Magallanes which during 2004 ranked between third and fourth among Chilean regions with lower unemployment dropped to seventh place. Unemployment is particularly severe among women since it jumped from 6,9% in the last quarter of 2003 to 8,8% in 2004.

Mr. Nikovic said he was hopeful the tendency would reverse favourably given the recent Chilean government announcements of infrastructure investments in the region.

Anyhow Mr. Nikovic called on local authorities to "closely follow these latest numbers because they are indicative of production stagnation in the area, and not an upsurge as can be seen in the rest of the country".

Bernardo Troncoso, resident Finance Ministry representative in Magallanes admitted he was surprised by the latest statistics adding that "there's a change regarding the evolution of the last few years which is based on a considerable jump in unemployment among women". "Could be that women who undertook some economic activity on their own, have now decided to abandon those jobs", said Mr. Troncoso.

However he was confident of positive changes in the coming quarters but "if this does not happen, it will be obvious that the employment tendency of our region has changed compared to the logic of the last ten years".

Overall unemployment in Chile in the last quarter of 2004 reached 7,8% which is 0,4% above the same period a year ago and also beyond market expectations which estimated 7,5%.

This brings the overall average unemployment in Chile for 2004 to 8,8%, which is 0,3% higher than in 2003. Similarly in the capital Santiago de Chile, unemployment last December reached 12,1%, 0,4% above December 2003.

Chilean analysts indicate that the basic challenge is that the labour force in Chile is increasing faster than the creation of jobs. This is particularly true for young people looking for their first job.