Latin American and Caribbean unemployment dropped in 2010 – UN report

Ironworkers at work erecting the steel frame of a new building. Photo: Paul Keheler

21 January 2011 – The economic upturn in most Latin American and Caribbean countries in 2010 fuelled a 0.6 percentage point drop in unemployment – from 8.1 per cent in 2009 to 7.5 per cent – and is expected to lead to a further decrease of between 0.2 and 0.4 percentage points this year, the United Nations reported today.

But these indicators of recovery do not guarantee growth with decent work in the long term.

“To bolster the improvement in labour market indicators and generate more productive employment and decent work, the region’s countries need to strengthen their macroeconomic policies, improve regional and global policy coordination, identify and remove bottlenecks in the labour market itself and enhance instruments designed to promote greater equality,” the report added.

Issued by the UN Economic Commission for Latin America and the Caribbean (ECLAC) and the UN International Labour Organization (ILO), the study noted that international trade and financial conditions, as well as the upturn in domestic demand resulting from macroeconomic policy, generated economic growth of around 6 per cent for the region in 2010.

The recovery has fuelled the generation of formal employment, a rise in the employment rate, a fall in joblessness and a moderate increase in real wages, it added, but the performance of different countries and sub-regions has been very uneven.

On the one hand, high economic growth in Brazil has been accompanied by the vigorous creation of formal jobs and the unemployment rate has dropped to levels not seen in a long time. Other countries in South America have benefited from strong demand for natural resources from Asian countries. Combined with higher domestic demand, this has raised their economic growth rates and had a positive impact on employment indicators.

On the other hand, the recovery is still very weak in certain countries and sub-regions, particularly in the Caribbean, with employment indicators continuing to worsen.

This year the region overall is expected to register a 4.8 per cent rise in per capita gross domestic product (GDP).

Like the rest of the world, the Latin American and Caribbean region is also confronted with the challenge of transforming the way it produces so that its economies can develop along tracks that are sustainable in the long term. Climate change and the consequent challenge of developing and strengthening low-carbon production and consumption patterns will also affect the way people work, the report noted.

A great challenge ahead is to create green jobs that combine decent work with environmentally sustainable production patterns. Although the debate about the green jobs concept is fairly new in the region, examples already exist and a number of countries have moved ahead in this area.

Costa Rica has formulated a National Climate Change Strategy, including professional training in natural-resource management, while in Brazil fuel production from biomass has increased and social housing with solar panelling is being built. A number of other countries are advancing in areas such as ecotourism and sustainable agriculture.

The shift towards a more environmentally sustainable economy may cause jobs to be destroyed in some economic sectors and created in others. The working world will inevitably undergo major changes. If the issue is approached by way of social dialogue and appropriate public policies, there is a chance to use this shift to create more decent jobs, thereby contributing to growth in the economy, the construction of higher levels of equality and protection for the environment, the report concluded.

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Latin American and Caribbean nations expected to see growth in 2010 – UN report

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