Colombia | Non-Wage Employment, Major Driver of National Employment

Summary

National employment grows, mainly driven by non-wage employment (+8% annually in March). Of 1.1M jobs created, most are independent and informal, raising the informality rate to 57.2%. The challenge is to formalize this employment to improve conditions and reduce poverty.

Key points

• Key points:
• Creation of non-wage employment widely surpasses wage employment (947 thousand vs 110 thousand in the last year).
• More than 70% of wage employment in Colombia is formal, with better working conditions and social security coverage.
• 80% of independent workers are informal, with the majority being self-employed.
• High labor informality is directly related to higher levels of multidimensional poverty in Colombian households.
• Effective measures are required to reduce informality in independent employment and promote formalization.

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