Colombia | In august, the labor market showed good signs for the second consecutive month

In August, the unemployment rate stood at 12.3%, lower than in August 2020, but higher than in August 2019. Between July and August 2021, with comparable data, the unemployment rate fell by 1.2 p.p., a reduction that was leveraged on employment growth.

Key points

• Key points:
• In August, the national unemployment rate was 12.3% and the urban unemployment rate was 14.2%, representing a decrease of 4.4 and 5.4 percentage points, respectively, from August last year. However, as expected, these rates are still above the unemployment rates observed in August 2019, pre-pandemic.
• With seasonally adjusted data for each month, between July and August of this year, the national unemployment rate declined, leveraged on the boost in employment, as labor supply increased. In August, employment grew by 2.1% compared to July 2021, compared to an average monthly drop of 0.2% in the first half of the year. With this, in August, the number of employed persons, both national and urban, was at the highest levels observed since the beginning of the pandemic.
• In August, urban employment stood at 94.4% of its pre-pandemic level, the highest level observed since the beginning of the pandemic, and national employment at 96.7%.
• Despite the fact that the labor market continues to lag behind activity, a lag that has been observed throughout the reactivation process, in August the reduced restrictions on mobility and the greater attendance in education, among others, contributed to boost employment. In addition, an increase in hours worked continues to be observed with 58.4% of the employed working more than 40 hours in August 2021, compared to 49.5% in August 2020 and 55.2% in August 2019.
• It is expected that during the remainder of the second half of this year, more jobs will continue to be created, due to greater sectorial openness, the return to more generalized attendance in education, greater activity and active employment support policies. In addition, the increase in the number of hours worked may be anticipating greater hiring. The gradualness of the upturn will depend on the progress of the pandemic and the care strategy implemented.

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