“Employment inclusion is a central pillar for inclusive social development”
Transcript of Karina Batthyány's column
in InfoCLACSO – November 29, 2023
In this column, I want to share the main findings of the 2023 Social Panorama of Latin America and the Caribbean, prepared by the Economic Commission for Latin America and the Caribbean (ECLAC). It's a good time to reflect on the figures and analysis presented, based on the social, economic, and productive indicators reported by the various governments in our region.
At CLACSO, we have a strategic alliance with ECLAC, working in Latin America and the Caribbean on various training and research topics. In 2023, the updated Social Panorama of Latin America highlights labor inclusion as a central pillar for inclusive social development and analyzes the challenges and opportunities associated with it. ECLAC considers labor inclusion a cornerstone of the virtuous relationship between growth and equality. Therefore, labor inclusion must be given a central place in matters of equality.
ECLAC highlights the urgency of advancing a policy agenda for labor inclusion that centrally considers the reduction of informality and inequalities and contributes to the inclusive development of the region.
On this point, it is necessary to highlight two concepts. First, informality, a problem we face in Latin America and the Caribbean. Practically half the population finds itself in this situation and, therefore, without any kind of labor or social protection. This is precisely an element that exacerbates inequalities. And second, inclusive development, the United Nations' idea of leaving no one behind within the framework of the SDGs, the Sustainable Development Goals. In this sense, labor inclusion is a prerequisite for the integration of everyone into development.
The Panorama also raises how, since the end of the pandemic, declared in May 2023 by the World Health Organization (WHO), Latin America and the Caribbean continue to face structural challenges and a prolonged social crisis with consequences for health and education, with a situation of food insecurity linked to the increase in the cost of living and with a deepening of the care crisis and gender inequalities.
Furthermore, it is stated that from 2014 to the present, our region has experienced very low growth levels, approximately 0,8%. This is less than half the growth of the so-called 'lost decade' of the 80s. This low growth in the region is intertwined with various dimensions and levels of inequality. It is worth recalling that GDP growth in our region was 6,5% in 2021, 3,8% in 2022, and 1,7% in 2023. It is estimated that it could reach 1,5% in 2024.
Despite these negative trends, there are some slightly more favorable indicators, particularly a slight decrease in the incidence of poverty and extreme poverty in our region in 2022. There was also a reduction in income inequality as measured by the Gini index, an increase in labor force participation rates, an increase in employment rates, and a decrease in unemployment.
In general terms, inflation in the region is trending downward, although it is still higher than before the pandemic. We must be cautious with these figures because, despite the improvement in these indicators, more than 180 million people in Latin America and the Caribbean still lack sufficient income to cover their basic needs. Of those 180 million, 70 million cannot afford a basic food basket. Therefore, we must re-examine these figures, which give us a true picture of the extent of poverty and extreme poverty in our region.
The Gini coefficient of inequality, estimated based on household surveys, showed a slight improvement, falling by an average of 1,1% annually between 2019 and 2022. This is a slightly faster rate than that observed in the previous five-year period, between 2014 and 2019, when it had been declining at levels of 0,2% annually. This improvement has also impacted the evolution of poverty and extreme poverty in the Latin American region: the former decreased by 3,6% and the latter by 1,8%, representing an improvement compared to 2019. In 2022, this small decrease in poverty, according to the ECLAC report, is a consequence of real growth in labor income, and another slight improvement is projected for 2023.
Regarding the labor market, the report warns about the situation in Latin America and the Caribbean: “The region has been experiencing a slow-motion crisis since 2010.” Why? Because between 2014 and 2023, the number of employed people grew by only 1,26%, half of the 3,2% recorded during that infamous lost decade of the 80s.
The 2019 pandemic deepened this trend, triggering the region's biggest labor market crisis since 1950. In 2020, job creation fell for the first time in 70 years. Following the worst of the pandemic, between 2020 and 2022, there was a slight recovery in employment levels, directly impacting the reduction of inequality, but income gaps remain very high in the region.
It's important to note that labor income is the primary source of resources for households across all socioeconomic levels. However, according to 2022 data, in the countries of the region, the total amount of income from paid work earned by the wealthiest decile was almost three times higher than that of the four poorest deciles.
There is also a chapter on gender inequalities. In this regard, the report shows that between 2001 and 2019, women's labor force participation rate increased slowly, but in 2020, due to the pandemic crisis, there was a massive loss of jobs that disproportionately affected women compared to men, causing an 18-year setback in the female participation rate.
One of the main reasons for this persistence in the gender gap in labor force participation is the unequal distribution of unpaid work, that is, the unequal distribution basically of domestic work, care work between men and women in the distribution within households and the absence in all our countries of public policies that place care tasks as an object of their own.
Regarding inequality and labor inclusion, it is reasonable to mention some indicators concerning young people. The report points out that in most countries of the region, the youth unemployment rate is nearly three times higher than that of adults: 23% of young people are neither studying nor working for pay, of whom more than 70% are women. Furthermore, almost 16% of adolescents do not attend the formal education system.
This ECLAC report highlights the importance of refocusing the analysis of inequality linked to labor inclusion policies, which should be geared towards expanding the coverage of social protection systems and strengthening income protection. It is also necessary to consider current changes in the world of work, the climate crisis, just transitions, and how all of these affect labor inclusion. Furthermore, policies focused on quality and relevant education must be implemented, providing the training necessary for effective participation in labor markets and productive structures. Finally, health policies for the general population are also essential.
If you would like to receive more information about CLACSO's training programs:
[widget id=”custom_html-57″]
to our email lists.
