By: Staff Writer
August 20, 2024
The Economic Commission for Latin America and the Caribbean (ECLAC) in their Economic Survey of Latin America and the Caribbean (LAC) 2024 said that growth in the economies around the region remain “weak,” coupled with sluggish employment growth for Q1 of 2024.
The report also said: “Economic growth in the region’s economies remains weak. In the first quarter of 2024, the economy grew by 1.5 percent compared to the year-earlier period. This was the third consecutive quarter in which the GDP of the Latin American economies increased by less than 2.0 percent, and the sixth quarter in which growth was lower than the 4.5 percent recorded in the third quarter of 2022.
“Monthly economic activity indicators show that all the region’s economies recorded a slowdown in the first quarter of 2024. Thus, while the average growth rate in Latin America fell by 1.7 percentage points between the first quarter of 2023 and the same quarter of 2024, the decline was 1.8 percentage points in the economies of South America and 1.5 percentage points in those of Mexico and Central America.”
The report also said: “Investment is showing signs of stagnation and remains at levels similar to those seen before the pandemic. After a slight increase in 2022, investment as a percentage of GDP continued to decline in 2023, falling back to pre-pandemic levels in a situation of high uncertainty and a deterioration in business confidence in many countries owing to the vagaries of the global economy, the effects of climate change and international conflicts. Similarly, the caution shown by monetary authorities in their interest rate management has resulted in monetary policy remaining tight, with real interest rates higher than before the pandemic.”
The employment statistics paint a similar picture. “In the first quarter of 2024, employment growth remained weak and the annualized growth in the number of employed persons was 0.9 percent, compared to 2.8 percent in the first quarter of 2023. Agriculture was the only sector to actually shed jobs in the first quarter of 2024 relative to the year-earlier period, with a 2.0 percent decrease representing the sixth consecutive quarter of shrinking employment in this sector. Although the manufacturing and services sectors saw employment grow by 1.1 percent and 1.4 percent, respectively, the rate of growth in the first quarter of 2024 was lower than in the first half of 2023 in both cases, by 1.3 and 2.5 percentage points, respectively.”
The report added: “The regional unemployment rate continues the downward trend that began in the third quarter of 2020, falling from 11.6 percent in the second quarter of 2020 to 6.5 percent in the first quarter of 2024. However, in the latter period, the rate was higher than in the second, third and fourth quarters of 2023.”