According to the Economic Commission for Latin America and the Caribbean (ECLAC) and the International Labour Organization (ILO), labour markets in Latin America and the Caribbean were fairly resilient to the slowdown in the regional economy in the first half of 2012, which bodes well for a positive outcome in this year's employment and unemployment indicators.
The two United Nations agencies launched their latest issue of the joint publication “The employment situation in Latin America and the Caribbean”, which states that the region's open urban unemployment rate will maintain its downward trend to finish 2012 at 6.4%, lower than the 6.7% posted last year.
The positive trend will be maintained despite the slowing economic growth rate, which went from 4.3% in 2011 to an estimated 3.2% this year. According to the publication, the labour market has been crucial in preventing an even greater slowdown in the economy, as there was a surge in household purchasing power thanks to job creation and a rise in real wages.
The document highlights an increase in the employment rate of 0.5 percentage points to 56% in the first half of 2012, improvements in job quality through a 3% expansion in formal employment covered by social security, and a 3% rise in real wages during the same period.
While the regional prospects are positive, ECLAC and ILO point out that the performance of the region's countries will be uneven. One group of countries will see a slowdown in job creation and formal employment, while another group will see greater buoyancy thanks to economic growth based on the relatively strong increase in investment (Chile, Ecuador and Panama) or exports (Costa Rica, Mexico and Nicaragua).
Despite the good news the situation for young people is not encouraging since they are facing obstacles in joining the labour market which results in high rates of unemployment, job insecurity and low incomes.
According to the study, although young people suffered the impact of the international financial crisis in a similar way to adults, the aggravating factor is that the former had a weaker starting position, with higher unemployment and job insecurity: before the 2008-2009 crisis the unemployment rate among 15 to 24 year olds was between 2.3 and 5.5 times higher than the rate among adults aged 25 and above.
However, the gap between youth and adult employment during the crisis increased in only five countries, while dropping in eight countries, including the largest countries such as Brazil (from a difference of 3.4 times in 2007 to 3.2 times in 2009) and Mexico (from 2.7 times to 2.5 times). For the region's 13 countries as a whole, the gap went from 2.9 times in 2007 to 2.8 times in 2009.
As a result, in relative terms the crisis did not impact young people more than adults. One positive fact in the publication is that the crisis has not interrupted the trend for young people to stay longer in the education system.
Nevertheless there is also a high proportion of young people who do not study or join the labour market (20,3%), especially young women dedicated to domestic work, who will find it difficult to enter the labour market in the future, according to the document.