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Montevideo, June 21st 2021 - 07:22 UTC

 

 

Latin America unemployment in 2021 forecast at 11.1%, according to ILO

Saturday, June 5th 2021 - 08:57 UTC
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“Employment must be at the center of the economic recovery,” Pinheiro pointed out “Employment must be at the center of the economic recovery,” Pinheiro pointed out

The International Labor Organization (ILO) Friday issued a report according to which 28 million Latin Americans are in a situation of working poverty due to the pandemic, for an overall unemployment rate of 11.1% in the region for the year 2021.

In 2020 five million people fell into working poverty as a result of covid-19, ILO reported. Thus, almost 30 million Latin Americans, of whom 9 are in extreme poverty, have a job but do not earn enough to remain with their families above the poverty line.

Latin America and the Caribbean experienced the sharpest drop in the number of hours of work during 2020 when the equivalent of more than 30 million jobs would have been lost both due to departures from the workforce and the reduction in hours worked.

The report also pointed out that although in the first half of 2021 the region has experienced a solid recovery, in which the percentage of work hours lost has been reduced from 30% to 11%, Latin America continues to be the most affected region in the world today.

The ILO director for Latin America and the Caribbean, Vinícius Pinheiro, stressed the need to apply extraordinary measures to rebuild labor markets in the region, strongly affected by the virus.

“Employment must be at the center of the economic recovery,” Pinheiro pointed out, adding that the lack of employment in the recovery processes can lead to an increase in social unrest and affect Latin American political stability.

The ILO highlighted that the regional unemployment rate, of 8% in 2019 and 10.3% in 2020, would reach 11.1% in 2021, which would imply a total of 34 million people unsuccessfully looking for a job.

In 2022 there would be a reduction in the rate to 8.9%, according to forecasts, although there is a high degree of uncertainty that also affects data estimates.

The ILO explained that massive departures from labor force participation were a characteristic of this crisis and that the return of these people as economic activity restarts could put pressure on unemployment rates.

The data included in the report estimated that 23 million people left the workforce at the worst time in 2020.

In 2021 an estimated 17 million people have returned to the labor market, although pre-pandemic levels have not yet been reached.

The text has warned about the possibility that the recovery of employment is slow in the region, especially for formal employment, which could have repercussions in an increase in informality.

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