With the decline of productive sectors such as public administration and the return to negative territory of important lines such as industry and construction, which took away the strength of the growth seen in commerce; Once again the balance of the labor market in Colombi puts on the table the urgent need of a reactivation plan that stops a slowdown that hits young people hardest.
Although it had already been taken for granted that the annual comparison of unemployment was going to show increases in the second half of the year, compared to what was observed in 2023, the fact that the unemployment rate has been around 10% for five consecutive months, has in mind alerts the unions because the bad step is spreading more than it should and this could take its toll on competitiveness in the future.
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And behind the 9.7% annual variation reported by Dane for Augustwhich grows 0.3 basis points compared to 12 months ago, there is a reality that requires further analysis, starting because although the situation for women improved slightly, although the gender gap remains, young people continue to be the most affected, since between men and women there were 51 lost places.
Immediate reactivation
As soon as these data were known, María Claudia Lacouture, president of the Colombian American Chamber, indicated that this should also serve as a warning bell due to the aggravating factors that the labor reform that is currently being discussed in Congress and is being prepared for its passage could mean. to the Senate.
Unemployment in Colombia
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“The sustained increase in unemployment should be a wake-up calln to immediately reactivate the economy. The plan established weeks ago cannot continue to wait; It is necessary to start it as soon as possible. Likewise, it is essential to transmit messages of trust and certainty to the productive sector,” said Lacouture.
In relation to labor reform, the president of AmCham Colombia said that they are concerned that “despite calls from various sectors of society and proposals based on a comprehensive vision of the country’s labor reality, the Executive has insisted on presenting a reform that discourages job creation and perpetuates informality and negatively impacts competitiveness and the use of technology.”
Likewise, he recalled that the labor changes that this Government seeks with its project go against what the country needs, since the reform ignores fundamental rights of workers and limits learning opportunities for young people; contrasting that this would only aggravate a problem that requires urgent actions to resolve.
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Five cities
Following what was reported by Dane, the National Federation of Merchants indicated that attention must be paid to the behavior of the labor market in the regions, since although it remained below 10% in its national total, this good news does not extend to the large most regions and that leads them to think that the balance for all of 2024 would not be the best.
“The possibility of reaching a single-digit unemployment rate in the country is receding. In the June-August quarter of this year, only five of the 23 cities closed with a rate of less than 10%. A year ago, that number was nine,” they explained.
Currently, the cities with the highest reports of job unemployment for the period June – August 2024 are Quibdó (25.5%), Riohacha (16.4%), Ibagué (15.2%), Florencia (14.3% ) and Sincelejo (12.2%); while the lowest records were in Medellín (8.3%), Bucaramanga (8.9%), Santa Marta (9%), Neiva (9.6%) and Bogotá (9.8%).
Public off-hook
As was noted at the time, apparently the strength that has been giving him The public sector of the economy is declining as the months go by and proof of this is the decline of 74,000 jobs lost between August 2023 and 2024, which placed it as the second sector with the sharpest falls in this period.
Piedad Urdinola, director of Dane.
Courtesy – Dane
However, according to BBVA Research, not everything is bad, since if the unemployment rate is adjusted for seasonality, it is observed that the variation was 10%, which can be considered stable with respect to July of this year, and ranking by below its average level for the first half of the year, which was 10.6%.
“Despite the stability in the unemployment rate between July and August, in August, employment showed a higher level, with 23.3 million people, compared to 23.2 million in July, seasonally adjusted,” they concluded.
Along with public administration, construction (-84,000), real estate activities (-71,000), financial activities (-59,000), professional and scientific activities (-59,000) and industry (-43,000) appeared on the list of the largest collapses. Meanwhile, on the other side of the coin, artistic activities (+195,000), commerce (+159,000), accommodation (+116,000) and agriculture (+77,000) are observed, with the highest increases.
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Given this, Bruce Mac Master, president of Andi, stated that it is It is also important to take into account that, when analyzing the unemployment rate with seasonally adjusted data, in August 2024 this measurement closed at 10%, remaining in double digits consecutively for eleven months, since October 2023.
“An increase in the unemployment rate was also recorded in the 13 main cities and metropolitan areas, going from 9.6% in August 2023 to 10% in August 2024. Additionally, we have been warning about the growth of the inactive population outside the labor force which, in August alone, increased by 183,000 people, taking pressure off the unemployment rate,” he explained.
Unemployment
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Due to this and although it recognizes that in August nearly 257,000 jobs compared to the same month last year, highlighted that an increase in job creation does not necessarily represent a decrease in the unemployment rate.
“It is clear then that several of the labor market indicators show signs of stagnation or deterioration. At the same time, this panorama is one more symptom of the slowdown of the economy that does not vary significantly, in a scenario in which, for example, in the first half of the year of the 39 industrial activities reported by Dane, only 9 had positive variations in its production,” he said.
Thus, he closed by joining the calls for an economic recovery plan to be launched as soon as possible and the labor market to be protected, since if unemployment does not increase due to the bad streakthe effects could be seen on the informality side.
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