Employment Situation in Latin America and the Caribbean is a twice-yearly report prepared jointly by the Economic Development Division of the Economic Commission for Latin America and the Caribbean (ECLAC) and the Office for the Southern Cone of Latin America of the International Labour Organization (ILO).The coronavirus disease (COVID-19) pandemic led to an unprecedented crisis in the region's economies and in its labour markets, where the recovery has been slow, partial and uneven. However, as noted in the first part of this report, there were favourable changes in the main indicators of these markets in the first half of 2022. First, in the second quarter of 2022, the employment rate returned to the level seen before the crisis and the unemployment rate fell 2.8 percentage points compared to the year-earlier period to 7.3%, lower than the pre-pandemic level. Similarly, the participation rate improved, although it is still below the level seen prior to the health crisis. Beyond the difficulties posed by the current labour market situation, the region's economies face the challenge of reversing the weak growth in productivity and investment registered since the debt crisis.

More than a decade has passed since the introduction of comprehensive macroeconomic stabilization packages and trade, fiscal, and financial market reforms in Latin America and the Caribbean. However, growth prospects remain disappointing; labor markets show lackluster performance, with low participation rates, high and persistent informality, and, in some cases, open unemployment. Creating viable and lasting employment is vital to reduce poverty and spread prosperity in the region. The failure to create more and more productive and rewarding jobs carries substantial political, social, and economic costs. 'Job Creation in Latin America and the Caribbean: Recent Trends and Policy Challenges' provides a thorough examination of the labor market trends in the region in recent decades and assesses the role that labor demand and labor supply factors have played in shaping these outcomes.

In 2022, the main labour indicators for the region --participation rate, unemployment rate, employment rate and number of employed-- recovered and returned to 2019 levels. Employment policies that, since 2020, were aimed at job creation in general shifted in 2021 to target the segments hardest-hit by the pandemic, further boosting the recovery in employment in the economy as a whole and among young people and women in particular. A return to pre-pandemic levels is not enough. High levels of informal employment and wide gender gaps persist, and wages and productivity have returned to pre-pandemic trends, indicating stagnation at best. The region should therefore pursue public policies that are pro-investment, pro-innovation and increase productivity and macrofinancial stability. This must be complemented by active labour policies for greater job creation and more equitable and formal labour markets.

Law and Employment analyzes the effects of regulation and deregulation on Latin American labor markets and presents empirically grounded studies of the costs of regulation. Numerous labor regulations that were introduced or reformed in Latin America in the past thirty years have had important economic consequences. Nobel Prize-winning economist James J. Heckman and Carmen Pagés document the behavior of firms attempting to stay in business and be competitive while facing the high costs of complying with these labor laws. They challenge the prevailing view that labor market regulations affect only the distribution of labor incomes and have little or no impact on efficiency or the performance of labor markets. Using new micro-evidence, this volume shows that labor regulations reduce labor market turnover rates and flexibility, promote inequality, and discriminate against marginal workers. Along with in-depth studies of Colombia, Peru, Brazil, Argentina, Chile, Uruguay, Jamaica, and Trinidad, Law and Employment provides comparative analysis of Latin American economies against a range of European countries and the United States. The book breaks new ground by quantifying not only the cost of regulation in Latin America, the Caribbean, and in the OECD, but also the broader impact of this regulation.

In the last ten to fifteen years, profound structural reforms have moved Latin America and the Caribbean from closed, state-dominated economies to ones that are more market-oriented and open. Policymakers expected that these changes would speed up growth. This book is part of a multi-year project to determine whether these expectation have been fulfilled. Analysing the impact of the reforms on employment it is argued that expectations were not fulfilled with respect to the operation of the labour markets. The reforms limited the expansion of employment in some sectors, particularly in tradeable goods. They also created a bias in labour demad for better educated workers which exacerbates inequality. It is thus made clear that the region faces major challenges both in increasing the number of jobs and improving job equality.