34 million jobs lost by the COVID-19 crisis in Latin America and the Caribbean

At least 34 million jobs in Latin America and the Caribbean have been lost due to the COVID-19 pandemic, according to a new report from the International Labour Organization.

Countries need to adopt immediate strategies to address the labour crisis, which, the report says, could widen existing inequalities in the region.

“We face an unprecedented challenge, that of rebuilding the region’s labour markets, which implies facing structural failures that have worsened with the pandemic, such as low productivity, high informality, and inequality of income and opportunities of decent work,” said Vinícius Pinheiro, Director of the ILO Regional Office for Latin America and the Caribbean.

The second edition of the Labour Overview in times of COVID-19: Impacts on the labour market and income in Latin America and the Caribbean warns of “the drastic contraction of employment, hours worked and income.”

It says that during this crisis “34 million workers lost their jobs (some temporarily)”, according to available information from nine countries that represent more than 80 percent of the economically active population of the region. The employment rate reached 51.1 percent in the first quarter, a reduction of 5.4 percentage points compared to the data for the same period of the previous year, which represents “a historical minimum value.”

The report also highlights that as of the third quarter of 2020, levels of economic activity have slightly improved. Data reveals the beginning of the recovery in employment and the return of some workers to the labour force.

“Preliminary signs of recovery are positive news, but the impact of COVID-19 on work and business was enormous, and the road ahead is long. It is essential to re-launch the bases for the reactivation of the economy with health security, ensuring favourable conditions for the operation of businesses and for the creation of more and better jobs,” said Pinheiro.

The report shows that Latin America and the Caribbean is the region with the greatest contraction in working hours in the world, with an estimated loss of around 20.9 percent for the first three quarters of 2020. This figure is almost double the global estimate of 11.7 percent.

Income from work contracted by 19.3 percent, also well above the world rate of 10.7 percent.

Given that labour income represents, on average, between 70 percent and 90 percent of total family income, these reductions have meant great losses for many households, with significant impacts on poverty levels, the report adds.

To tackle the effects of the pandemic, countries in the region have adopted combinations of measures aimed at protecting jobs, income,and companies.

Read the technical note: Labour Overview in times of COVID-19: Impacts on the labour market and income in Latin America and the Caribbean.

Original source: ILO