Jobless growth?
Not by accident, analysts with different ideological perspectives have agreed on the stagnation of employment. Since the pandemic, the country has lost a significant number of jobs, particularly those with lower levels of education. At the same time, with the recovery, those generated by the private sector have been mostly informal jobs. But even so, we are still in deficit over 2019.
Analysts deplore the situation both in terms of the magnitude of the total reduction, as well as the deterioration in the quality of employment and the drastic reduction from formal to informal. The numbers, however, are the consequences of something bigger. We must look for the causes. Here is a thesis.
The country has many years of inflexible and obsolete legislation. Governments have reacted negatively to any hint of reform. This denialist attitude is promoted by the violent reaction of the unions, which, as everywhere else in the world, cling to the status quo.
However, this prolonged delay in modernizing employment rules has been a drag on the growth and reorganization of the labor sector towards greater formality and productivity. Thus, for years companies have learned to control their labor costs and consider the creation of new jobs as a last resort. The typical small and medium-sized business organization became a kind of unstable equilibrium, which has not been good for either the company or the worker. The ups and downs of the economy or the market have been a headache to reorganize or develop companies. This long-standing reality is evident in the historical deterioration of real wages and in the points of GDP needed to generate new employment.
With the pandemic, many companies were forced to make unwelcome employment decisions. But they were also, in many cases, a unique opportunity to resize and reorganize the business. Those who, for years thought about doing things differently, but had neither the time nor the resources to do so, were forced to do so by the pandemic. Many who closed and took losses, reopened again, but with a business designed in a different way, with fewer dependents. Not to mention those who closed and never reopened.
