Youth Unemployment Key Challenge for LATAM: ILO

Despite recovery following the COVID-19 crisis, structural inequalities persist, affecting young people in the labor market. According to the International Labor Organization’s (ILO) report on Youth Employment in Latin America and the Caribbean, the youth unemployment rate in the region remains three times higher than that of adults, with a high percentage (60%) of young people employed under informal conditions.

The report, Youth in Change: Challenges and Opportunities in the Labor Market of Latin America and the Caribbean, warns of the gap between education and market needs. Nearly 60% of young workers in the region are employed in the informal sector, limiting their access to social security and labor rights, states the research. 

The rise of new employment modalities, such as platform-based work, provides flexibility but comes with unstable working conditions, analyses ILO. The disconnect between skills acquired in the education system and labor market demands poses another challenge to youth employment. According to Computrabajo, the disparity between supply and demand creates a scenario where companies must actively search for candidates with specific skill sets to meet their needs, reports MBN. 

ILO states that most young people who neither study nor work for pay are women, due to unpaid domestic and caregiving work. In most countries, informality rates among women are higher than those of men. Additionally, seven out of 10 women make up the largest share of young people neither studying nor working for pay, highlighting the challenges women face in accessing stable, formal employment, explains Gerson Martínez, Regional Specialist in Labour Economics, ILO Regional Office for Latin America, 

The report shows low participation of young people in unions and growing distrust in social security and pension systems. As a result, many opt for alternative savings mechanisms and distance themselves from traditional protection schemes. 

As MBN reports, 95% of Mexican organizations anticipate that AI tools will significantly change the way they operate. This outlook reflects an environment in which organizations are looking to optimize their operations through technological innovation. However, this process is accompanied by a growing skills gap, particularly in critical areas such as cybersecurity. In this context, the most pressing challenge is the lack of specialized talent. 

To address this, ILO recommends strengthening vocational training systems, implementing active youth employment policies, enhancing social protection, and expanding national care systems to reduce barriers young women face in accessing employment.