KEY labour market indicators continued to improve in
Latin America and the Caribbean, despite the global economic slowdown, the 2012 Labour Review by the International Labour Organisation has shown.
However, the report states that unemployment still affects nearly 14.8 million workers and their families in the region.
"The urban unemployment rate maintained its downward trend. Through the third quarter of 2012, the rate was 6.5 per cent of the labour force, 0.4 percentage points lower than in the same period of 2011. At the end of 2012, the regional urban unemployment rate is expected to fall to 6.4 per cent, 0.3 percentage points below that recorded for the region in 2011," ILO said in its executive summary released to the media yesterday.
"This reduction means that the ranks of the unemployed will decrease by 400,000 in urban areas," it adds.
According to ILO, in most countries of the region, the unemployment rate decreased among both women and men in 2012 but said that gender gaps still exist.
"Unemployment among women continues to be 1.4 times higher than that among men. Through the third quarter of 2012, the weighted regional average of unemployment rates among women was 7.7 per cent, whereas that among men was 5.6 per cent," the report says.
Meantime, it states that youth unemployment continued to decline, falling nearly a percentage point during the period, from 15.2 per cent to 14.3 per cent. "This decrease mainly reflects the long-standing decline in the pressure for youth to seek employment (labour force participation rate), which is associated with higher school enrolment".
However, it points out that despite
the progress, "indicators of the
greater exclusion of youth from
the labour market persist given that
the youth unemployment rate triples that of adults."
In terms of sectors, manufacturing, which in previous years substantially contributed to job creation in the region, was the activity most affected in terms of growth capacity and job creation in several countries of the region during the first nine months of 2012, as compared with the same period of 2011. "By contrast, job creation in trade increased in most of the countries with available information, in keeping with this sector's growing weight in the occupational structure of the region," ILO says.
"Moreover, administrative records of a group of countries with available information indicate advances in the creation of jobs with social security coverage. Through the third quarter of 2012, nearly all countries of the region reported significant increases in employment with social protection, with rates of over three per cent, although in some countries, progress in this area slowed with respect to 2011. This trend reflects the increase in formal employment recorded in the past two years."
Other highlights of the report include:
* In 2012, the downward trend in inflation continued in most countries of the region, with an estimated regional average of 4.4 per cent (December 2011 - October 2012), as compared with 6.2 per cent for the same period last year. This strengthened the purchasing power of wages.
* Through the third quarter of 2012, average real wages rose in most countries with available information at higher rates than in the previous year, which reflects the vigour of job creation in the region. In real terms, the average increase for eight selected countries was 2.4 per cent, surpassing that for the same period of 2011 (1.2 per cent).
* The regional weighted average for real minimum wages experienced a more substantial increase of 6.9 per cent, considerably above that recorded for 2011 (2.7 per cent). This is because the vast majority of Latin American countries increased their minimum wages in 2012.
* Over the mid and long term, most countries in the region have maintained a policy orientation that has enabled them to improve or preserve the purchasing power of minimum wages. Nevertheless, minimum wage levels still lag behind in terms of purchasing power and the value of a basic family consumer basket.
* The improvement in the real minimum wage has enabled less-skilled wage and salaried workers and workers new to the labour market to share in the benefits of economic growth and productivity increases. Together with the increase in employment and the population-to-employment ratio, the minimum wage increase has strengthened household consumption and domestic demand, one of the
pillars of the region's continued economic vitality.
Said the report: "Latin American countries still face the two-fold challenge associated with wages: as a source for satisfying basic needs and as a component of production costs, and consequently, the competitiveness of enterprises. Actors in the world of work have an opportunity to agree on a wage policy that can reconcile this duality. Productivity plays a key role in this challenge. Minimum wage and collective bargaining policies are essential tools for trade unions and enterprises. Countries in the region with recognised leadership in this area can share their good practices and successful experiences.