MercoPress. South Atlantic News Agency

Strong Chilean economy creates more jobs and jobless

Unemployment in Chile increased during the March-May quarter reaching 8.7%, which is 0.4% above the same period a year ago (8.3%), according to the latest release from the Chilean Statistics Institute.

latest release from the Chilean Statistics Institute. The percentage is above what markets were expecting and higher than the 8.3% of the February-April quarter. Apparently there has been a significant increase in the last twelve months (17%) in the number of people who are coming into the labour market looking for their first job.

Encouraged by improved economic prospects 256.120 people joined the Chilean work force in the March-May quarter, 4% above the same period in 2005, which has therefore had a direct influence in the 0.4 points increase in the unemployment rate argues the Statistics Institute.

Chilean labour experts anticipate that unemployment in 2006 will be above last year's average because of the greater job expectations.

"This has been particularly evident in gender's participation with women representing 49.9% of new incorporations to the labour force in the last twelve months".

Overall all sectors of the Chilean economy have been creating more jobs in the last twelve months with the exception of public utilities (gas, electricity, water). Similarly the number of self employed is decreasing as the number of employees' increases.

Manufacturing has been particularly active in the last twelve months with a 6.9% increase compared to mining which has stabilized at 4.7%, down from 6% last year.

"The increase in the labour force and employment has been higher than anticipated and has generated a higher unemployment. As the chances of finding a job increase, people are coming out and looking, which was the opposite a year ago when people actually left the market", said Joseph Ramos, Dean of the Economics School from the University of Chile. "I therefore anticipate a higher unemployment this year, probably 8.3%".

Andres Concha, Secretary General of Chile's Manufacturing Association admitted he was surprised by the number of jobs created in the last twelve months "with no sector lagging". "I believe that at this rate unemployment should be closer to 6.5% in the long term. I don't agree with the 8% forecasts".