Important sectors of the economy have ceased to be attractive

Six sectors that generate two-thirds of private jobs in the national territory are no longer attractive for private investment and generate only informal jobs, according to the labor adviser, Rene Quevedo.

These sectors are: trade, construction, logistics, industry, hotels and restaurants and other service activities.

It should be noted that between 2012 and 2022, the increase in informal employment in relation to the total increase in these sectors was as follows: construction 406%, trade 123%, logistics 115%, industry 99%, hotels and restaurants 99% and other services 107%.

The expert indicated that what this reflects is that in the last decade, the overall labor contribution of these economic activities, as a block, was informal.

He added that the trend worsened in 2022, the year in which Mitradel processed around 20,000 new monthly employment contracts (82% fixed-term), below the average of almost 32,000 in 2019 (79% fixed-term), while generating around 10,000 new informal jobs per month compared to 3,079 per month that were generated in the year before the pandemic.

Quevedo explained that nine out of 10 new informal jobs generated monthly come from these six the sectors mentioned above.

Between October 2021 and April 2022, of the 101,000 jobs created in that periodabout 60 thousand were informal, and 11 thousand 300 civil servants, which together represent 70% of the employment expansion.’

85%

of the new jobs created by the logistics sector in the country are informal.

fifty%

of new jobs in the Panamanian trade sector are informal.

In terms of job creation, Quevedo pointed out that these six key sectors have lost their attractiveness for private investment, as well as its prospects for sustainable demand and the potential for profitable operations in the short and medium term.

That being said, the economist Juan Jovan He pointed out that the simple fact that the economy has reactivated in principle, but that it has an unemployment rate of almost 10 percent, well above the period before the pandemic, shows that there is growth even without employment.

“What is happening is that, in order for unemployment not to grow, the Panamanian economy must grow to 5%, and this year it seems that this figure will not be reached, so the problem of unemployment and informality will continue to be present in the country”.

He said it would be a liability People’s government to present to the public a strategy for solving this problem, “which unfortunately he didn’t do.”