Monday, 07 November 2022 20:10

Infrastructure accounts for 14.2% of total employment in Latin America

Written by Evelyn Alas

According to an analysis prepared by the Inter-American Development Bank (IDB), despite the potential for employment generation, infrastructure subsectors present a significant gap in terms of labor Sistema de Información de Mercados Laborales y Protección Social (SIMS).

Although with limitations, available employment data indicate that infrastructure accounts for 14.2% of total employment in Latin America, totaling around 50 million workers.

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In the case of El Salvador, 5% work in transportation and storage, 0.5% in electricity, gas or water, and 7% in construction.

Construction has the highest levels of labor informality among economic activities: at the regional level, 72% of the employed population in this branch of activity does not contribute to social security. In the transportation and warehousing sector, the majority of jobs (55%) are also informal, but at levels similar to the regional labor informality of 56% for all activities.

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In Electricity, gas and water activities, the formality rate is 50% of jobs. Labor informality entails significant costs for the welfare of societies. Among the direct implications, it has been highlighted for reducing the tax base and threatening the fiscal balance of social security institutions.

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There are currently around 270 million employed workers in the region, according to official statistics aggregated for 25 countries included in the IDB's Labor Market Information System.

The sectoral contribution to total employment has not varied significantly over the last decades.