As a result of the economic crisis during June 2020 the number of workers contributing to the Salvadoran Social Security Institute decreased to 810 thousand, in the following months the figures improved and in March 2021 the figure rose to 861 thousand.
According to the report corresponding to March 2021 of the Salvadoran Social Security Institute (ISSS), the different economic activities report a sustained recovery, especially the sectors that were mostly affected by the economic downturn such as commerce, restaurants, hotels and services.
The labor market reports a structural change, as fewer and fewer people are being paid a fixed salary for their work, while at the same time the number of employees earning per project is increasing.
Although the trend has been reported globally for several years, the pandemic accelerated this process, as the economic crisis generated by the Covid-19 outbreak destroyed thousands of formal jobs.
Due to the precariousness of the English language, in recent years’ companies in the Contact Center & BPO sector have decided to close thousands of jobs in the region and relocate their investments to other markets where they have no difficulty in recruiting qualified personnel.
Reports at a global level show that the command of English is one of the weaknesses at a Central American level.
Faced with the sudden change that the new normal generated in companies, employees are challenged to increase their skills to work remotely, adapt to more flexible contracts and refine their technological skills and cognitive qualities.
Telecommuting has become an everyday occurrence among companies in the region, which have had to adjust to the restrictions imposed by governments due to the outbreak of covid-19.
Eliminating "tax harassment", suspending threatening messages to the private sector, such as lifting bank secrecy, and stopping persecuting the formal employer is part of what Costa Rican entrepreneurs are proposing to generate more jobs in the next two years.
In Costa Rica, the business sector presented the Alvarado administration with a proposal of 113 actions to generate new jobs in the next two years.
After a home quarantine was decreed in El Salvador, the government intends to prohibit the dismissal of employees who do not attend work.
In the context of the crisis generated by the spread of covid-19, a proposal is being discussed that establishes that the employees of companies that are not allowed to continue their activities should be sent home with their salaries and benefits, and that they cannot be subject to dismissal, salary discounts or suspension of contract, nor be forced to take their vacation in advance.
After the national unemployment rate remained at 7% between 2014 and 2017, it fell by almost 1% to 6.3% in 2018.
The occupancy rate is the ratio of the employed to the total EAP. It represents the degree of effective use of the human resource available for work. By 2018, the occupancy rate is 93.7%, that is, of every 100 economically active persons, 94 were employed, explains the Multipurpose Household Survey.
In recent years, the sector in Guatemala has lost nearly 30,000 jobs, because the high costs resulting from having one of the highest minimum wages in the region, makes it more profitable only to export raw materials, rather than making them in the country.
Vestex figures show that in recent years several jobs have been lost in the sector, given that between 2006 and 2018 the industry lost a considerable number of jobs, going from 82,109 to 53,636 places, equivalent to a 35% decrease.
Because there is still no regulation for part-time employment in Guatemala, textile businessmen estimate that the country loses between 40 and 70 thousand jobs.
For representatives of the Costume and Textile Commission (Vestex), the high operating and labor costs in Guatemala cause businessmen to send cut pieces to Honduras, El Salvador and Nicaragua to be assembled.
Informality, access to social services and lifelong learning are some of the aspects on which the region's economies must focus in order to improve labor market conditions.
Representatives of the International Labor Organization (ILO) presented in San José, Costa Rica, the report "Working for a brighter future", prepared by the World Commission on the Future of Work, which describes the factors that affect work in the countries of the region.
Despite the location and the fiscal benefits that in some cases the countries of the region offer, the lack of education of the population will be the main barrier to continue attracting large investments.
The lack of guarantee of finding the competent and sustainable human capital necessary for the proper operation of companies is an issue that negatively influences the attraction of important investments in Central America.
In the Central American region, the average unemployment rate for those aged between 15 and 24 is estimated to be around 11%, with lack of work experience being the main barrier to accessing the first job.
According to figures from the Central American Observatory of Social Development, Costa Rica and Panama are the countries in the region with the highest rates of youth unemployment, with 27% and 15%, respectively.
Although new jobs will emerge, technological changes will have a strong impact in the Central American region, where there is a high proportion of jobs with a high risk of automation.
According to forecasts made by the Inter-American Development Bank (IDB), in 2018 it was estimated that 75% of workers in Guatemala and El Salvador are in high-risk automation jobs.
Poor mathematical skills and limited English language proficiency are the main weaknesses reported by young people seeking to develop in the labor market in El Salvador.
An analysis by the Salvadoran Foundation for Economic and Social Development (Fusades), details that, in general terms, the labor market segment made up of young people shows strong and weak areas.
Between 2016 and 2017, the Metropolitan Area of San Salvador registered a slight increase in the unemployment rate, rising from 6.8% to 7.5%.
According to the Multiple Purpose Household Survey for 2017, the unemployment rate "...By age ranges, unemployment among young people (16 to 24 years old) is 14.4%, among people aged 25 to 59 it is 5.1%, while for those over 59 it is 5.9%."