WASHINGTON, USA – Economic crises like the one that Latin America and the Caribbean are suffering now, have long-lasting effects on the structure of employment and may permanently drive many from the formal economy, according to a new World Bank report.
The COVID-19 pandemic is having the biggest impact on low-skilled workers and is exacerbating the region’s already high inequality, according to EMPLOYMENT IN CRISIS: The Path to Better Jobs in a Post Covid-19 Latin America. Low-skilled workers often suffer from lower earnings for a decade following a crisis, while high-skilled workers see a quick rebound. As a result, government labor policies should focus on providing social safety nets and retraining, as well as improving the macroeconomic and business environment to ensure long-term and inclusive economic growth.
“Economic recovery has often been a myth when it comes to jobs, but it doesn’t have to be that way,” said World Bank vice president for Latin America and the Caribbean Carlos Felipe Jaramillo. “The right policies can help limit the impact crises have on employment and foster the creation of more jobs in recoveries.”
