The Government celebrated the weak growth in private sector employment

Registered private sector employment showed growth for the first time in 11 months, according to data released by the Ministry of Labor. This increase, although modest, has been received with optimism by the Governmentwhich attributes it to the recent labor reform implemented under the Bases Law.

Registered employment in the private sector grew by 0.1% in August and 0.2% in September 2024, which represents the incorporation of approximately 5,000 workers into the labor market. For him Governmentthis increase, although small, is significant since it breaks a trend of 11 consecutive months of decline in registered employment.

The sectors that contributed the most to this growth were construction, industry and commerce, which showed greater hiring of personnel during these months. He Government attributes this growth to the labor reform implemented under the Bases Law, which was recently enacted and regulated.

According to the Secretary of Labor, Julio Cordero, the reform has generated an environment of greater trust and legal security for companies, which has encouraged the hiring of new employees.

The Government celebrated the weak growth in private sector employment

Among the notable measures of the reform are the elimination of fines for unregistered work and the simplification of hiring and firing processes, which has reduced the associated costs and risks for employers.

The response to labor reform has been mixed. On the one hand, the Government and some business sectors have celebrated the first signs of recovery in registered employment, arguing that the reform is beginning to show its positive effects.

The Government celebrated the weak growth in private sector employment

Flexibility

According to Cordero, “five thousand more workers is enough, although of course we would have liked them to be much more, but the trend towards the incorporation of personnel shows something very positive.” On the other hand, unions and some labor analysts have expressed concerns about the quality of employment generated and working conditions.

They argue that the flexibility of labor standards imposed by the Government could lead to precarious employment and a decrease in workers’ rights. Furthermore, they point out that the observed growth is still very limited and that more measures will be needed to achieve a sustained recovery in employment.