Updated 1 month ago

Unemployment and informal work explain the Latin American situation

The shortage of formal workers translates into lower tax revenues, resulting in less availability of resources to invest in social programs or infrastructure, for example. It also generates a high vulnerability of the pension and health system, while not achieving the desired return on productive activities, because informal work tends to be of poor quality and does not usually add value to the different economic activities .

But the responsibility for this situation should not fall on the workers themselves, who often opt for informality because they do not find attractive jobs, or because they do not directly get a job in the formal circuit.

There is a shared feature in Latin America that should make us reflect: the more educated and educated the worker is, the less likely he is to work in informality even when many carriers for context reasons are not going to be highly needed.

This is a very ingrained problem in the region, which is summarized in abundance of labor and, at the same time, a shortage of quality jobs or those who offer good salaries, an affiliation to social security systems and contribute knowledge that improves To society. To this is added that the companies - and the whole productive apparatus - sometimes do not find the human capital that they need.

This situation represents, today, the main obstacle for Latin America to return to the levels of vigorous growth of the first decade of this century and when talking about society, insecurity becomes a protagonist.

The countercyclical nature of informality and the low incomes perceived by the less educated and vulnerable population are indicative of the relevance of informal subsistence in the region and of the risks we face in the current cycle of low growth.

The challenge is to create the necessary conditions to sustainably increase the number of formal workers. Although the reality in the region is heterogeneous (in some countries there are bureaucratic obstacles, in others the cost of the formal worker is high, in others there is no penalization or control of informality, etc.), there is a shared characteristic that should make us reflect: The more educated and educated the worker is, the less likely he will be to work in informality.