MercoPress. South Atlantic News Agency

Magallanes Region retains second lowest unemployment rate in Chile

Despite a 1.2 percentage points increase to 4%, Magallanes region is below Chile's national average of 6.6% unemployment

Unemployment in Magallanes Region, extreme south of Chile reached 4% in the March/May quarter, which is 1.2 percentage points higher than a year ago, and 0.3 percentage points more than the previous mobile quarter, according to the latest report from the country's Stats Office, INE.

 By gender, men's unemployment reached 4% in the March/May quarter, up 1.5 percentage points over a year ago, while for women it was 4.2% or 0.7 percentage points higher.

However the 4% is below Chile's national average of 6.6% and has Magallanes as the country's region with the second lowest unemployment, pointed out Labor secretary Carlos Abarzúa Villegas to La Prensa Austral from Punta Arenas.

Furthermore the 1.2 percentage points jump in unemployment in Magallanes responds to a 3.5% increase in the region's labor force, which was also higher than the 2.2% upward trend of those holding jobs.

“This is basically positive because it means that the labor force, which now stands at 81.000, has incorporated more women and young people”, said Abarzúa Villegas.

The sectors which saw an increase in employment were Education; Social and Healthcare Services and public administration, according to INE's stats.

However the Chilean official was also cautious about the future given the global context, underlining that faced with this situation the local government with support from Santiago funds was sponsoring work plans in the oil industry.

“For this we are working with the union and ENAP, GeoPark, Petromagallanes, Petrex and YPF to try and reabsorb those who have been left redundant”.

Similar plans are in the workings for retail and construction.

Paul Gnadt Olivares, the Economy representative in Punta Arenas said that Magallanes was also undergoing a seasonal phenomenon, which traditionally means less jobs, since “tourism, construction and other industries stop hiring or simply slowdown activity” during the off season months.

Gnadt indicated that Magallanes has the potential to keep creating jobs since for every contracted person, there is another 0.8 person which provides services.

“And this is very low compared to the rest of Chile where the equation is 1 to 2.7 persons. Likewise the number of people accepting to work 30 hours a week or less is increasing, which is also an opportunity”.

In effect, Gnadt said that with funds from Santiago there is a program to support productivity, innovation and growth for micro and small enterprises that make up 95% of employment in Magallanes.

For this, according to the Chilean official several government organizations directed to different industries together with the Program for Extreme Zones are promoting investments to boost domestic demand in Magallanes, “and for this the micro and small enterprises are vital”.