Between April 2020 and the same month in 2021, the labor market improved, but gaps persist with the prepandemic situation. May, due to the effects of the blockages in the economy, is expected with additional setbacks.
The employment and unemployment statistics for April 2021 came with several peculiarities. First, there was a clear recovery in the labor market compared to the same month last year, but mainly due to the fact that April 2020 has been the worst month of the pandemic in terms of job destruction. In relation to the same period in 2019, it is clear that there is still a lot to recover to reach the prepandemic levels. To this is added a third peculiarity: the statistics for April show a “photo” taken before the strike, so it is not difficult to foresee that May will leave additional temporary setbacks as a balance.
It may interest you: Unemployment rate in Colombia was 15.1% in April 2021
According to the National Administrative Department of Statistics (DANE), the unemployment rate in April was 15.1%, lower than the 19.8% registered in the fourth month of 2020, but still far from the 10.3% of April 2019 (before the pandemic). Juan Daniel Oviedo, director of DANE, highlighted several results as positive. For example, 3.9 million people were added to the employed population (compared to April 2020), for a total of 20.4 million. However, in the same month of 2019 the figure was 21.8 million.
The unemployed population, on the other hand, fell from four million in April 2020 to 3.6 million people this year (in 2019 there were 2.5 million people unemployed). It is also noteworthy that the labor force was increasing last April: 2.9 million people came out of inactivity (they found work or are looking for work). More in detail, of the 1.8 million who came out of inactivity due to being dedicated to housework, 1.05 million are women who entered or re-entered the workforce.
However, the reactivation continues to have behaviors that do not benefit men and women equally. Of the 3.9 million people who got jobs, 2.2 million are men and 1.7 million are women. “This implies that for every four men who got their jobs back, only three women achieved that result,” said Oviedo. And in terms of unemployment, of the 456,000 fewer unemployed people, 410,000 are men and only 46,000 are women. “For every ten men who came out of unemployment, only one woman was able to do so,” added the director of DANE.
For Rosmery Quintero, president of the small and medium-sized enterprises union (Acopi), this employment report “shows a recovery, especially when compared to the same month last year (…) As a contribution to the increased occupation, we see with satisfaction that the recreation, entertainment and other services are playing a very important role ”. However, he already commented that May will have “a negative behavior in the different indicators due to the number of blockages that are preventing work properly and that raw materials and supplies reach the companies.”
Follow the news of El Espectador on Google NewsAccording to a survey by Confecámaras on the effect on companies of the “social situation and public order”, which was applied to 12,979 businessmen in Colombia, 44.7% of those consulted assured that they have not been able to receive inputs for their operation and the 41.8% has had a reduction in the entry of supplies as a result of the blockades that, according to the unions, have affected 29 of the 32 departments. Additionally, 22.2% of those surveyed stated that they had to suspend their operation, while 53.4% have operated between 1% and 50% of their capacity.
When analyzing the monthly unemployment rate, that is, the variation between March and April 2021, it can be seen that it increased 1.2 percentage points at the national level, highlights María Claudia Llanes, economist at BBVA Research for Colombia. “This is explained by the reduction in employment between those two months, which could be due, to some extent, to the partial confinements that occurred in April. With this, the April data represents a setback in terms of the recovery of employment and also the dynamism of the labor force with respect to March 2021, ”says the economist.
“The outlook for next month is even more worrying, given that sectors such as industry and commerce, which had been recovering jobs, will probably be negatively affected due to the restrictions to economic activity in May derived from the pandemic. and the protests that take place in the main cities of the country, ”says Paola Ríos, a researcher at the Labor Market Observatory of the Externado University of Colombia. “Gender gaps persist (…) The results are more worrying for young women, since out of every three young people who neither study nor work (“ ninis ”), two are women”, she adds.
In line with the concern regarding May, Sergio Olarte, chief economist at Scotiabank Colpatria, considers that “the unemployment rate will continue to deteriorate due to the third wave of COVID-19 and due to the national strike that we had throughout the month of May. In the future we see a partial resolution of unemployment, a situation that can help to return to the path of economic recovery with unemployment rates similar to those obtained in February and March, which ranged between 13.5% and 14% ”.
According to the Confecámaras survey, 90.4% of the entrepreneurs surveyed stated that of the jobs it generates, between one and five are at risk due to the effects of the situation and the blocking of the roads. “If business activity blockages continue, 35.1% of those surveyed affirm that they will have to partially close, 32.5% will be forced to reduce costs to sustain the operation, 20.2% will reduce their staff and 12.2% will close their company ”, highlighted Confecámaras, whose survey was applied 78.4% to micro-companies, 17.4% to small companies, 3.6% to medium-sized companies and 0.7% to large companies.
The third peak of the pandemic, the restrictive measures and the public order situation, experts agree, will show their effects on the labor market next month, as well as on the consumer price index (inflation) that will be released on next Saturday.
