Up to 41 million people could be left unemployed by the coronavirus pandemic in Latin America and the Caribbean, the International Labor Organization (ILO) warned in a new report Wednesday.
“The unemployment rate could rise between 4 and 5 percentage points, bringing the number of unemployed in the region to a historical record of 41 million people. If the crisis worsens, the employment situation could worsen, amplifying social inequalities,” the report said.
Before the pandemic hit, the unemployment rate in Latin America and the Caribbean was 8.1% -- about 26 million people by the end of 2019, according to ILO.
The report analyzed data from the World Bank, which estimates a 7.2% drop in the region’s economic growth – leading to an 12.3% unemployment rate.
The ILO also analyzed the latest numbers from the International Monetary Fund, which estimated an economic contraction of 9.4%, resulting in a 13% unemployment rate.
What the rates mean: “In absolute numbers, these rates imply an increase in the number of people who are looking for a job and do not get it; from 26 million before the pandemic to 41 million in 2020,” ILO specialists explained at a press conference on Wednesday.
Where unemployment will hit hard: Various economic sectors are seeing high rates of unemployment. About 40% of workers are in high-risk sectors of hospitality, food service, small businesses and manual labor.
Another 17% are in the medium-to-high risk sectors, and only 20% of the labor force is engaged in low-risk economic activities such as those in government, education and health jobs.
"About 60% of those employed in Latin America and the Caribbean are exposed to significant losses of employment, hours worked and income,” according to the report.