The construction industry cannot yet recover

Three years after covid-19 pandemic the construction industry fails to recover, leaving thousands of workers unemployed unemployed workers.

As explained by Panama Chamber of Construction (Capac), this industry is one of the sectors that creates the most jobs in the Central American country. More than 150,000 jobs were created nationally before the pandemic.

Although the leadership in Capac is convinced that the sector will soon recover, spokesmen for Single National Union of Workers in Construction and Related Industries (Suntracs) They point out that there are currently around 30,000 unemployed workers who worked before the pandemic.

The sector contributed Gross domestic product of Panama (GDP) in 2022 of 9,663.7 million, achieving an annual percentage variation of 18.5%, which is positive for the industry. This represents positive and favorable growth. Also similar to the percentage variation in the year 2021 – 2020, which was 28.8%. This sector contributes with 13.2%. Gross domestic product.

The Capac explains that the impact of the pandemic was the period that most affected the sector in recent years. After that, it is crucial to create a national investment program, at the infrastructure level, so that this sector continues to contribute to national production and job creation.

To achieve recoveryaccording to Capac It is necessary to continue at the state level, with the investment development plan, primarily infrastructure. As well as improving the national economic environment and jobs, so that people, mostly families, can approach owning their own home.

He the construction sector predicts moderate growth this year of 10%, which means only one point above that recorded in 2022. In addition, the sector would still be below the 14.8% of construction gross domestic product achieved in 2019.

One of them, he stated, is that the approval of the extension of the law on preferential interest took eight months to be finally sanctioned by the executive, thus a large part of the year was lost and the promoters did not market all the homes that were planned, which also discouraged builders and developers accelerate new residential projects with prices between 40 thousand and 180 thousand dollars.

He Report on work for 2023 This will be known only on October 30 this year, but in the first half of the year. Mithradel processed 145,950 new employment contracts (24,325/month), which is a figure lower than the 202,108 that the entity processed in the same period in 2019 (33,685/month), while we went from generating around 1,900 new informal contracts per month (2017) to more of 10 thousand (2022).

As he explains employment expert, René Quevedothe construction industry is one of the hardest hit sectors with the highest level of job insecurity in the economy.

He points out that the industry suffered two “shocks” from which it has not yet recovered, ending Channel expansion and pandemics.

72.5% of jobs in constructions are informal (INEC, April 2022), and of the new jobs created in 2022 in the sector, 80% were informal.

Between 2017 and 2022 construction it lost 43,520 paid jobs, added 20,586 informal jobs, and experienced a 10.2% drop in average wages, from $706.90 (2017) to $635.10 (2022).

Reactivation of some works public infrastructure will moderately improve employment in the manufacturing sector construction.

Still, uncertainty remains in the climate for private investment, meaning that most jobs which will be generated in the sector will continue to be informal.