Conclusion is contained in a report presented by ECLAC and ILO.
The recovery of the labor market in Latin America and the Caribbean after the covid-19 pandemic will take years and will require government action. The conclusion is contained in a joint report released today (10) by the Economic Commission for Latin America and the Caribbean (ECLAC) and the International Labor Organization (ILO). In the second quarter of 2020 alone, the region closed 47 million more jobs than in the same period last year.
According to the document, even if the Gross Domestic Product (GDP, sum of goods and services produced) in Latin America and the Caribbean grew again by an average of 3% per year, the region would only reach the level of GDP in 2019 in 2023 If the regional GDP grows 1.8% per year, the average rate observed in the last decade, the GDP of 2019 would only be reached in 2025. If the region grows only 0.4% per year, the level observed since 2014, the GDP of 2019 would not be achieved in the next decade.
To counteract this trend, ECLAC and the ILO suggest active policies to stimulate the economies of the region, accompanied by sectoral measures that promote sustainable development with employment. Among the recommended actions are the promotion of environmental policies that stimulate employment, intensive public investments in labor and industrial and technological policies that build national productive capacities and increase competitiveness.
The report also advocates expanding credit to micro, small and medium-sized companies. Eventually, governments could subsidize part of the credit, allowing loans to be offered with long terms and low interest rates.
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