Colombia | More formal employment is a shield against the slowdown

Summary

Colombia has made significant progress in terms of labor formality in the last four years. Labor formality has positive implications for people's living conditions, productivity and the country's capacity to face adverse events, among others.

Key points

• Key points:
• Formal workers have more years of formal education, better working conditions and, given that they pay social security contributions, they are better covered against income losses when any of the risks that occur during the life cycle (illness, unemployment and old age, among others) materialize.
• Going forward, we believe that, with the economic slowdown, there will be some deterioration in labor formality. The good news is that we are starting from a more formal labor market than in previous episodes of economic slowdown.

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